Agent Arrested and Convicted for Selling an Annuity.

[Norwayguy]

Just curious... In retrospect, do you think you could have done more to ensure what you were doing was in the clients best interests? Maybe contact a family member and have a discussion with the prospect and maybe one of their kids together?

I'm not going to bash you or anything. I personally would not have sold the annuity to her without first having a meeting with her and one of her family members. I think the way you did it was irresponsible. Not criminal, but definitely not responsible and worthy of being sanctioned by California DOI. I just think if she were my mom and someone did this then I'd be very, very upset with the agent and I would probably go after them.

I wish you luck in your appeal and your new water bottle venture. I won't donate to your defense because I believe the way you went about this was wrong and is not representative of the ethical behavior that should be demonstrated by those in our profession.

Again, good luck with your appeal.

I have never sold an annuity to an 85 year old that named a nonfamily member as the beneficiary. I have however done it many times with younger clients who wanted a boyfriend named instead of a family member. I am not sure I can fault Glenn when the existing funds already had Lou named as the beneficiary, the woman told me during the interview how she was estranged from her son etc, I am not a family counselor but an insurance agent. I would however not have sent the client to get a check I would have sent transfer forms.

 

[b61mack]

Glen the best advice I can give you, is to speak to Mark Colbert, he is know as the insurance investigator at the ampm insurance fourm. His website is markcolbert.com I only know him from his reputation. He may give you some real direction.

 

[hardworkwillwin]

Just curious... In retrospect, do you think you could have done more to ensure what you were doing was in the clients best interests? Maybe contact a family member and have a discussion with the prospect and maybe one of their kids together?

I'm not going to bash you or anything. I personally would not have sold the annuity to her without first having a meeting with her and one of her family members. I think the way you did it was irresponsible. Not criminal, but definitely not responsible and worthy of being sanctioned by California DOI. I just think if she were my mom and someone did this then I'd be very, very upset with the agent and I would probably go after them.

I wish you luck in your appeal and your new water bottle venture. I won't donate to your defense because I believe the way you went about this was wrong and is not representative of the ethical behavior that should be demonstrated by those in our profession.

Again, good luck with your appeal.

Hey dubya. Fran wanted nothing to do with her family members, and I did call the son the following day.Invited him to talk with me.The family has had a falling out for years, and Lou was already the beneficiary at the bank on the CD.
- - - - - - - - - - - - - - - - - -
1. Brief Statement of Facts
a. Glenn Neasham was an insurance agent in Lakeport, California.
b. On February 1, 2008, Fran Schuber and Louis Jochim, both 83 at the time, made an unsolicited visit to Neasham's office. Jochim was Schuber's boyfriend and had been a client of Neasham's for eleven years. At the meeting, Jochim told Neasham they wanted to discuss the possibility of purchasing an annuity for Schuber, using funds that had previously been held in a CD.
c. On February 4, 2008, Neasham had a second meeting with Jochim and Schuber, where Neasham made a presentation to Jochim and Schuber that lasted about one hour and thirty minutes. Schuber filled out an annuity application where she said she was in good health. During the meeting, Neasham did not observe any signs of dementia. The annuity named Jochim as the beneficiary, and Jochim's daughter as the contingent beneficiary. Schuber's son, Ted, was not named as a beneficiary.
d. That day, Schuber and Jochim went to the bank to withdraw the $175,000 for the annuity. On February 5, 2008, the bank manager notified California's adult protection officials, saying that Schuber seemed confused and influenced by Jochim.
e. On February 13, 2008, Neasham delivered the annuity to Schuber. Neasham's commission was $14,000. Schuber signed a delivery receipt for the annuity. Both Schuber and Jochim signed a letter, which verified that Schuber intended to purchase the fixed annuity and that her chosen beneficiary was Jochim (with Jochim's daughter as the contingent beneficiary).
f. The Lake County District Attorney then began to investigate the annuity transaction.
g. Neasham was charged with a felony violation of section 368, subdivision (d), that between February 1, 2008 and February 28, 2008, he committed theft and embezzlement with respect to Schuber's property.
h. Neasham entered a not guilty plea. Following a jury trial, he was found guilty. Post trial motions were denied, and this appeal followed.
2. Because Neasham did not have any information that Shcuber was suffering from dementia, he could not have the requisite mens rea to commit theft.
a. Generally, " '[t]he existence of a mens rea is the rule of, rather than the exception to, the principles of Anglo–American criminal jurisprudence.' " (People v. Simon (1995) 9 Cal.4th 493, 519) In other words, there must be a union of act and wrongful intent, or criminal negligence. (Pen.Code, § 20; People v. Vogel (1956) 46 Cal.2d 798, 801.) "So basic is this requirement that it is an invariable element of every crime unless excluded expressly or by necessary implication." (People v. Vogel, supra, at p. 801, fn. omitted.) In addition, Penal Code section 26 provides that a person is incapable of committing a crime where an act is performed in ignorance or mistake of fact negating criminal intent; a crime cannot be committed by mere misfortune or accident. (People v. Lopez (1986) 188 Cal.App.3d 592, 597.) When a person commits an act based on a mistake of fact, his guilt or innocence is determined as if the facts were as he perceived them." (People v. Osborne (1978) 77 Cal.App.3d 472, 479.)
b. There was no mens rea here. In order for Neasham to have had the requisite intent to commit theft, he needed to have actual knowledge that Schuber had dementia. Here, there was no evidence presented that Schuber showed signs of dementia to Neasham at the time of the sale of the annuity. In her annuity application, Schuber represented to Neasham that she was healthy. According to Deanna Jones, who ran Neasham's office, Schuber seemed to be quite competent, knew what she was signing, and did not look confused at all. Neasham went through all the stipulations and the annuities with Schuber, who asked basic questions about those items. Neasham also asked Schuber questions to make sure that she understood the terms of the annuity. (3 RT 585-91) Moreover, the California's Department of Insurance approved the Allianz MasterDex 10 annuity for sale to consumers through the age of 85 (Schuber was 83).
c. Neasham is essentially being held strictly liable for misjudging Schuber's mental health. It is a violation of due process to hold an insurance agent criminally liable for making an inaccurate assessment of a client's mental state. If this is the rule, insurance agents are going to be charged with a duty to acquire sufficient medical expertise that they can make a determination as to an applicant's competence. Given the nature of dementia, it can be very difficult to determine the mental state of an individual based on a short meeting. As explained by expert testimony at trial, dementia waxes and wanes.
d. Under the rule set forth by this case, insurance agents will be required to ask personal medical questions—many of which could violate privacy laws—and could be held criminally liable if potential clients withhold that information.
3. Requiring insurance agents to diagnose their clients before selling them an annuity would have a chilling effect on the industry of selling annuities.
a. Articles addressing the chilling effect of the rule set forth by this case: http://www.insurancenewsnet.com/article.aspx?id=335094&type=topnews#.ULprcZhFp3s
http://online.wsj.com/article/SB10001424052702303863404577288480158320286.html
[Anne to provide more information.]
b. The Neasham verdict leads to the possibility that any time a client—especially an elderly client like Schuber—purchases a product and later is unclear about the transaction or cannot remember the reason that she bought the policy, that client can file a complaint with the district attorney and the agent risks going to jail.

Please donate to the appelate trust fund so we can hire the RIGHT attorney to help fight this.
ANBC - Glenn Neasham Appellate Trust Fund

 

[tlmarketing]

If you were in my shoe's you'd ask. If we dont win a new precedent gets set for all of us.THIS MUST BE OVERTURNED.

I don't really see this as a precedent setting case....There were LOTS of warning signs and plenty of opportunity to cancel this deal and walk away and it would have saved you from much of this ordeal.

I see this more as a cautionary tale to other agents that when you encounter warning signs on a case, you better slow down and proceed with caution.....if you choose to proceed at all.

 

[hardworkwillwin]

If you were in my shoe's you'd ask. If we dont win a new precedent gets set for all of us.THIS MUST BE OVERTURNED.

I don't really see this as a precedent setting case....There were LOTS of warning signs and plenty of opportunity to cancel this deal and walk away and it would have saved you from much of this ordeal.

I see this more as a cautionary tale to other agents that when you encounter warning signs on a case, you better slow down and proceed with caution.....if you choose to proceed at all.

An agent doesn't have the right to cancel a transaction. There were NO red flags during the process other than the son not the beneficiary.

 

[VolAgent]

An agent doesn't have the right to cancel a transaction. There were NO red flags during the process other than the son not the beneficiary.

That is such BS. You could have refused to write the app, you could have told Fran to take a day to think about it. You could have done transfer paperwork instead of sending them to the bank. You could have told the carrier your concerns.

There are a million things you could have done that would have slowed down this transaction and saved your hide. A simple note to compliance probably would have sufficed.

 

[tlmarketing]

An agent doesn't have the right to cancel a transaction. There were NO red flags during the process other than the son not the beneficiary.

Not true...The agent absolutely has multiple opportunities to walk away from a sale....at presentation time, application time, delivery time, free look period, etc..Allianz would have unwound this in the beginning.

Just a few of the Red Flags:

2/4/08 - you explain annuity to bank rep...says she is not concerned about the annuity...she's concerned about Lou's influence.
2/5/08 - You call her son. Son tells you he is concerned about Mom's health.
2/13/08 - your client and her boyfriend come in for policy delivery. Later on that day you called biyfriend to ask if your client has Alsheimers.
4/1/08 - Investigator meets with your client and the boyfriend

 

[hardworkwillwin]

Not true...The agent absolutely has multiple opportunities to walk away from a sale....at presentation time, application time, delivery time, free look period, etc..Allianz would have unwound this in the beginning.

Just a few of the Red Flags:

2/4/08 - you explain annuity to bank rep...says she is not concerned about the annuity...she's concerned about Lou's influence.
2/5/08 - You call her son. Son tells you he is concerned about Mom's health.
2/13/08 - your client and her boyfriend come in for policy delivery. Later on that day you called biyfriend to ask if your client has Alsheimers.
4/1/08 - Investigator meets with your client and the boyfriend

Some of your facts are wrong.
1)The son said after purchase he was concerned about mom's overall health.DID NOT GO INTO DETAIL.Remember Fran and son had a falling out for years.
2)I asked Lou if Fran had dementia towards the end of December. Not on 2/13/2008.I asked after DOI interview in December 2008.Lou denied it as he did on 12/17/2010 at 10;42 am.
3)4/1/2008 investigator meets with client and friend. Two months after the sale.
- - - - - - - - - - - - - - - - - -

That is such BS. You could have refused to write the app, you could have told Fran to take a day to think about it. You could have done transfer paperwork instead of sending them to the bank. You could have told the carrier your concerns.

There are a million things you could have done that would have slowed down this transaction and saved your hide. A simple note to compliance probably would have sufficed.

Why would I refuse to write the app? I as well as others saw nothing wrong with Fran. She was like ALL other senior prospects that day.

I gave her the brochure Feb 1st, and they came back Feb 4th for the presentation. I gave them three days to look it over.My ONLY concern was son not being beneficiary. The carrier wouldn't consider that a red flag. Lou was already the beneficiary on the bank CD.

 

[tlmarketing]

Uhh...maybe you want to read the letter you wrote and sent to the judge regarding your case....Above dates and info are from your letter to the judge.

 

[hardworkwillwin]

Uhh...maybe you want to read the letter you wrote and sent to the judge regarding your case....Above dates and info are from your letter to the judge.

Maybe YOU should reread it.