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March 23, 2017 at 12:13 PM
Massachusetts regulators say a broker-dealer based in San Antonio must pay $100,000 fine and offer restitution to four senior clients who were sold variable annuities and market-linked CDs at community banks and credit unions.
The BD, Investment Professionals Inc. (IPI), admitted to the facts set out in the order, according to the office of Commonwealth Secretary William Galvin.
In one case, a senior client in the final stage of terminal cancer had almost all of her assets put in a variable annuity, “leaving her without access to liquid funds,” the regulators say.
“This case highlights the dangers of aggressive sales culture that leaves older customers exposed to pressure to buy unsuitable investments,” explained Galvin in a statement. “This is especially true when the broker-dealer is operating out of a community bank.”
As part of the agreement, IPI must hire an independent compliance consultant to review its policies governing supervision of their Massachusetts-registered financial consultants and the sales of securities to persons over 65, as well as its compliance with Financial Industry Regulatory Authority rules on networking arrangements, noncash compensation, and gifts and gratuities.
Bay State Network
