Tougher penalties in play for annuity fraudsters

Tampa Bay Business Journal

Jan. 1 marks the beginning of tougher penalties for fraudsters in Florida as an effort to target agents using predatory annuity practices against seniors helped create new law. The new legislation also makes it a third degree felony to submit a fraudulent signature, prohibits agents from using fake designations to falsely imply financial expertise, and clarifies and strengthens suitability requirements that agents must meet when selling an annuity to a consumer.

“This legislation represents a good first step,” Florida CFO Alex Sink said in a release touting her office’s effort on the issue. “I will continue to push for it to be a felony to intentionally deceive a senior into an inappropriate annuity product. And I’m not going to rest until we’re able to put unscrupulous agents that prey on our seniors behind bars,” she said in the statement.

Many victims are trusting seniors, who were misled into making risky or inappropriate financial investments, including annuities and reverse mortgages, the release said by agents and scam artists, the release said.

Other highlights of amendments to F.S. 627.4554 include requirements that:

• Agents licensed in Florida must take a minimum of three hours of continuing education on the subject of suitability in annuity and life insurance transactions.
• Any person who willfully submits fraudulent signatures on an application or policy-related document commits a felony of the third degree.
• Any agent who misuses a designation to imply they have specialized training or knowledge or misrepresents their actual qualifications, commits a violation of the unfair trade practices.
• The period in which the consumer can obtain an unconditional refund if the consumer decides not to accept the life or annuity policy is changed from 10 to 14 days from the date the policy is received.