A Massachusetts regulator accused MetLife Inc. of defrauding investors by wrongfully releasing reserves to boost its bottom line instead of making pension payments to hundreds of retirees in that state.
Massachusetts Secretary of the Commonwealth William Galvin claims MetLife’s public filings had “material misstatements” about the insurer’s finances because it didn’t properly administer those pension plans, according to an administrative complaint filed Monday. The regulator is seeking an order to force MetLife to locate all retirees in that state that are owed benefits, as well as possible sanctions, censure and fines.
The complaint adds to the scrutiny MetLife has faced since disclosing in recent months that it failed to pay about 13,500 customers who were owed pension benefits. The New York-based insurer has said that the U.S. Securities and Exchange Commission was investigating the matter and that the company is searching for those customers.
“We self-identified and self-reported this issue to our regulator and to the public,” MetLife spokesman John Calagna said in an email. “We have taken aggressive steps to locate unresponsive annuitants who are due funds and already have or will commence payment, including interest, once the necessary paperwork is complete.”
MetLife acquired responsibility for the customers by selling group annuity contracts to the customers’ plan sponsors, according to the complaint.
MetLife sent two letters to the customers, according to the complaint.