The broker compensation investigations cast a shadow this week over life and benefits distributors’ reports on their latest quarterly results.[@@]
National Financial Partners Corp., New York, and Clark Inc., Barrington, Ill., both mentioned the investigations in discussions of their earnings for the fourth quarter of 2004.
NFP, a company that now owns about 150 brokers and agencies, is reporting $12 million in net income for the latest quarter on $204 million in revenue, up from $9.7 million in net income on $140 million in revenue for the fourth quarter of 2003.
NFP has been growing rapidly through acquisitions, but profits were strong at operations owned in 2003 as well as businesses acquired in 2004, NFP says.
NFP disclosed earlier this year that several of its subsidiaries have received subpoenas and other requests for information about broker compensation issues. The company also is conducting an internal review of its own. So far, though, “neither the company nor outside counsel has discovered any evidence of bid rigging, fictitious or inflated quotes or related matters,” the company says in a discussion of its earnings.
Clark, a company with a large executive benefits practice, is reporting $11 million in net income for the latest quarter on $94 million in revenue, up from $4.4 million in net income on $86 million in revenue for the fourth quarter of 2003.