NU Online News Service, Jan. 30, 2004, 1:17 p.m. EST – Prudential Financial Inc. says it took the initiative to disclose possible variable annuity marketing problems to NASD, Washington.[@@]
NASD announced Thursday that it has ordered Prudential Equity Group Inc. and Prudential Investment Management Services L.L.C., 2 Prudential units, to pay $2 million in fines and return $9.5 million to customers in connection with allegations about problems with annuity sales in New York state.
The Prudential units have agreed to the settlement without either admitting or denying the allegations.
But NASD admits that it learned about the alleged problems from Prudential, and Mary Flowers, a spokeswoman for the Newark, N.J., insurer emphasizes that Prudential itself disclosed the matter.
“We found it through our controls and procedures,” Flowers says.
Prudential already has paid back $8 million of the $9.5 million that it is supposed to return to investors, Flowers says.