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Home > Blog > Category Archives: MetLife Securities

Category Archives: MetLife Securities

MetLife Variable Annuities

FINRA has notified MetLife that it is recommending disciplinary action due to its sales of variable annuities. FINRA’s  concerns include misrepresentations, unsuitable investments, and supervision in connection with the sales and replacements of variable annuities and certain riders associated with them. Please contact us if you have any questions or concerns about your purchase of MetLife variable annuities.

Retained Asset Accounts: Buyer Beware?

Retained asset accounts are facing growing scrutiny, with regulators calling into question the disclosure policies of insurance companies that market and sell the products to clients. In July, New York Attorney General Andrew Cuomo opened a fraud investigation into retained asset accounts, with subsequent probes announced by Georgia and New York insurance departments.

Earlier this month, the U.S. Department of Veterans Affairs also announced plans to review its own insurance program, followed by the U.S. House Oversight and Reform Committee saying it would investigate insurance benefits for 6 million U.S. soldiers.

Insurers like MetLife and Prudential Financial use retained asset accounts as a way to keep cash when beneficiaries of the policies do not elect a lump-sum payout of death benefits. Beneficiaries are instead issued a “checkbook” to access their funds. Meanwhile, the insurance companies earn interest from the money in the accounts.

Retained asset accounts are not backed by the Federal Deposit Insurance Corporation, however – a crucial fact that creates uncertainty and added risks. Take the case of Jasmine Williams.

After her mother passed away in 2002, Williams was assured by MetLife that her $101,819 in life insurance benefits were safe. She was then sent a guaranteed money market “checkbook.”

The next year, Williams, who was 19 at the time, told MetLife that a cousin had taken nearly $50,000 by forging her name on 12 checks. Williams sought reimbursement. The insurance company and Pittsburgh-based PNC Bank NA, which processed the MetLife checks, refused to make good on Williams’s losses, however. Each company denied responsibility, according to the Bloomberg, which first reported the story.

If Williams’s money had been in a bank, instead of an account managed by an insurer, federal and state laws would have required the bank to verify signatures on checks and cover losses.

“It’s high risk for the beneficiary to have money in these insurance accounts,” said Robert Hunter, director of insurance for the Consumer Federation of America in Washington, in the Bloomberg article. “I’ve been telling people to get their money out. You have what I consider a little black hole.”

MetLife Securities, Affiliates Fined $1.2M; Investigation Of Broker Misconduct Continues

MetLife Securities and three affiliates – New England Securities Corp., Walnut Street Securities, and Tower Square Securities – are facing a fine of $1.2 million by the Financial Industry Regulatory Authority (FINRA) for failing to properly monitor and review their brokers’ email correspondence with the public. One of those brokers is Mark Salyer, who stole nearly $6 million from his customers through private securities transactions he initiated to raise capital for various real estate development companies.

In January 2009, the Securities and Exchange Commission (SEC) barred Mark Salyer from associating with any broker, dealer or investment adviser.

The $1.2 million fine also resolves allegations that MetLife supervisors failed to properly monitor brokers’ participation in outside business activities and private securities transactions.

According to FINRA, the failures allowed Salyer and another MetLife Securities broker to engage in undisclosed outside business activities and private securities transactions while working at MetLife Securities. Eventually, those failures cost MetLife Securities customers millions of dollars.

Investors who had accounts MetLife Securities and its three affiliates – New England Securities Corp., Walnut Street Securities, and Tower Square Securities are encouraged to contact us and tell us your story. Please leave a message in the Comment Box below or on the the Contact Us form.


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