The U.S. Securities and Exchange is pressing ahead with a federal civil suit involving a Southeastern viatical firm that attracted more than $1 billion in investments from 29,000 investors.
The SEC has added Steven Steiner to the list of defendants in the case, SEC vs. Mutual Benefits Corp. et al., which was filed in May 2004 in the U.S. District Court in Miami.
The SEC has accused the lead defendant, Mutual Benefits, Fort Lauderdale, Fla., of exaggerating likely earnings on viatical settlements by misrepresenting the life expectancies of the individuals who have sold it the rights to their life insurance death benefits. About 90% of the individuals who have sold the rights to their death benefits to Mutual Benefits “are well beyond their life expectancy estimates,” the SEC says in the latest version of the Mutual Benefits complaint.
The SEC amended the complaint earlier this month to put Steiner on the defendant list.
Steiner was a vice president at Mutual Benefits and a brother of Joel Steinger and Leslie Steinger, the SEC says. Mutual Benefits has listed Joel Steinger and Leslie Steinger as consultants in its annual reports, but the SEC says Joel Steinger was the company’s “de facto chief executive officer,” and the SEC says Leslie Steinger was a company principal and sales manager.
Steven Steiner belongs on the defendant list because he served as the “public face” of Mutual Benefits and represented the firm at many meetings with prospective sales agents and investors, the SEC says.
“On at least one occasion, Steiner assured a group of investors that most of the policies matured on time or before their life expectancy date and that the longest period an investor had to wait was 2 years,” the SEC says.