Annuity sale leads to criminal prosecution, Judge Eugene Hyman looks at recent CA case

In today's Speaking of Justice broadcast, the Honorable Eugene Hyman joins Scott Drake to discuss the recent criminal conviction of a California annuity agent charged with selling an annuity to an 83 year old woman who was alleged to be exhibiting signs of dementia at the time of the sale. Judge Eugene Hyman

This case, which was profiled in a recent Wall Street Journal article by reporter Leslie Scism, looks at the facts surrounding what could potentially be an disturbing case for annuity agents, structured settlement agents and others who work with either elderly or disabled clients. The wave of legislation and regulation that has written laws mandating criminal charges and compulsory reporting of financial abuse of those over the age of 65 should cause agents nationwide to review and rethink how they will handle clients moving forward.

The larger issues, beyond whether or not the annuity was suitable for a woman of this age, is that the jury felt that the commission paid the agent was of sufficient size, $14,000, that it indicated motive of criminal intent, thus allowing for conviction. The implication being that any financial product or transaction involving a senior in which the agent or advisor is being paid a substantial commission, might come back to haunt that advisor.

We will continue to follow this story as it was reported today that the agent was allowed to be free on bail pending a hearing and decision by the California Appellate Courts on this issue.



Posted on March 21, 2012 .