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I don't think he ever went to the bank. The boyfriend did I believe.
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Agent Arrested and Convicted for Selling an Annuity.
- Thread starter Crabcake Johnny
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- annuity
I don't think he ever went to the bank. The boyfriend did I believe.
G
Guest
Guest
Didn't he call the bank and tell the teller to send him a check? That's still a pretty big red flag.
I'm not saying the guy was right or wrong, but it leaves plenty of room for raised eye brows if the agent is trying to round up the client's money for them. That obviously isn't theft, but it is very poor judgment.
I could be remembering it wrong though.
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Lou(Frans boyfriend) called me from the bank, and said he was getting a hard time trying to move the money. He asked me to talk to the branch manager.I did NOT go to the bank.
G
Guest
Guest
Ah, thanks for clearing it up.
What's the status of getting your license back?
- 8,707
Time to apologize....Granted this thread is what 3 years old and the transaction is older than that but Neasham did not go with the client to the bank. The client's boyfriend went with her and the bank rep had a problem with his control over the client.
- 10,830
Yeah. The bank had a problem with the boyfriend. The Insurance Regulators & AG had a problem with the agent/sale.
Im glad Glenn was exonerated. There was nothing criminal about the sale. And it set a horrible precedent for the annuity industry.
But, he did happen to sell what I consider a horrible product. It could be considered suitable in that situation.... but there were much more suitable options in my opinion and in the opinion of many other agents. Selling a 15 year product to an 80 something year old is hardly ever a good idea.... and this serves as an excellent example of what can happen when you push the limits of suitability...
I must disagree with scagnt83. There is nothing wrong with selling an older person a longer term annuity. If the client wants growth for legacy then the longer the term the better the caps. It's how we build them. Since there's no chargeback at death for most all policies, they just become a great and safe accumulation vehicle. Nothing other than liquidity issues (which weren't in question here) could in fact be better. Once again, Glenn was a great agent. While I've never liked Allianz (and I felt like they hid like roaches when the light comes on), this annuity was a decent choice. We can debate whether there was better products or companies but we must be unified in our belief that selling an annuity to a senior who wants safety, income or a combination of the two is in many many cases a great choice. It was clear by the appellate decision that nothing concerning the product or the way it was sold was ever at issue or in question.
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I stated that the sale was legal.
It is very rare that you cant find a comparable product with a much shorter surrender.
Take the current climate for instance. If you have over $250k you can get a 9.5% Ap2p S&P 500 Cap on a 14 year product from Midland.
But that comes with only 5% liquidity.
But at the same time you can get up to a 7% Cap on a 7 year product from GA. And it has 10% free withdrawals.
Even though the 7 year is slightly less, generally speaking, it is much more suitable for someone in their 80s.
The excuse of legacy/caps/safety/income is only relevant if the 15 year product gives a significant advantage over a shorter term product. This is rarely true in my experience when it comes to those over age 80. The less life expectancy you have the less reason you have to tie up your money.
I understand that the client had other liquid assets available. My point is that other products could have accomplished the same goal with half the time commitment.
I supported Glenn in his defense. I feel that the sale was legal and fell under the definition of suitable. None of this should have happened.
But I do not support the sale of 15 year surrender products to elderly clients. I also do not support the advertising techniques Glenn used either. The fact that he had billboards mentioning guaranteed gains over 8% did not help his case with the Insurance Regulators or AG. He might not have gone to trial over that fact, but I guarantee you it did not cast him in a positive light in their eyes.
Dont get me wrong. I feel that a 14 or 15 year product can be perfectly suitable for some. And I wish Glenn and his family the best of luck. I have even sold 14 year products before. But there are usually better options for an 80 year old. And there are certainly less complicated options all over the place if you look past the high comp crap most IMOs push.
If Glenn didnt have misleading advertising and had sold a 7 year surrender product that did not require annuitization to surrender the policy; imo, there is a good chance charges never would have been filed.
jmho
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You might be surprised to know that over 90% of ALL fixed and indexed annuities end up being passed on as a legacy. Call any carrier you use and challenge my information. Selling your client short with lower caps is just not a sound decision. If liquidity is an issue then you shouldn't be selling the annuity in the first place. You really need to read the appellate decision. I've copied it so you can see what they said literally word for word on this subject:
"While the prosecution placed great emphasis on the penalty she might have incurred had she withdrawn more than 10 percent of the policy value within five years of its issuance, there was no evidence that Schuber had any intention or need to make such a withdrawal, the penalty did not apply if she became hospitalized or moved to a long-term care facility and, most importantly, there was no evidence that this standard term reduced the value of the policy to less than she paid for it."
This is the appellate judge who KNEW it was a long term annuity. HE had NO issues with it.
I understand that reasonable people can disagree but just saying a long term annuity is bad because the client is older gives no reason. It's just a random statement. Specifically, if liquidity is fine what's the issue going with better caps?
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And as well, it IS rare if not almost impossible to find similar caps of the same crediting method of in your example a 7 year vs a 14. You were comparing an AP2P vs a monthly average. The monthly average would historically have to return right at 15% to get the cap of 7. Therefore, when the markets up 9.5% and you're getting 9.5% on the 14 year, your client with the monthly average will more than likely only receive a 4.5% credit. Take that times 7 out of 10 years and you're down over 30%. In general, the only time that they would be close is when there is a bonus on the longer term annuity but not on the shorter one. Finally, the AP2P cap for the Great American policy you're referring to is actually 6%. It is what actuaries call "bonused". Meaning it's window dressed to make it more attractive on year one. It will, as sure as the day is long, drop considerably after year 1 (yes I sell both carriers, and they both are good companies). As far as Glenn's marketing practices, I am not familiar with any of it. Marketing an IAV with its rollup rate as an account value is generally misrepresenting the annuity (with the exception of Athene's Benefit 10). If you'd like to PM me I'd be willing to help you better understand how annuities are built and priced.
"While the prosecution placed great emphasis on the penalty she might have incurred had she withdrawn more than 10 percent of the policy value within five years of its issuance, there was no evidence that Schuber had any intention or need to make such a withdrawal, the penalty did not apply if she became hospitalized or moved to a long-term care facility and, most importantly, there was no evidence that this standard term reduced the value of the policy to less than she paid for it."
This is the appellate judge who KNEW it was a long term annuity. HE had NO issues with it.
I understand that reasonable people can disagree but just saying a long term annuity is bad because the client is older gives no reason. It's just a random statement. Specifically, if liquidity is fine what's the issue going with better caps?
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And as well, it IS rare if not almost impossible to find similar caps of the same crediting method of in your example a 7 year vs a 14. You were comparing an AP2P vs a monthly average. The monthly average would historically have to return right at 15% to get the cap of 7. Therefore, when the markets up 9.5% and you're getting 9.5% on the 14 year, your client with the monthly average will more than likely only receive a 4.5% credit. Take that times 7 out of 10 years and you're down over 30%. In general, the only time that they would be close is when there is a bonus on the longer term annuity but not on the shorter one. Finally, the AP2P cap for the Great American policy you're referring to is actually 6%. It is what actuaries call "bonused". Meaning it's window dressed to make it more attractive on year one. It will, as sure as the day is long, drop considerably after year 1 (yes I sell both carriers, and they both are good companies). As far as Glenn's marketing practices, I am not familiar with any of it. Marketing an IAV with its rollup rate as an account value is generally misrepresenting the annuity (with the exception of Athene's Benefit 10). If you'd like to PM me I'd be willing to help you better understand how annuities are built and priced.
Since I apologized in advance, I don't think I need to apologize again. Glenn cleared things up a few posts before yours.
