It’s that time of year when many of us receive a fancy invitation in the mail from a purported investment professional that we don’t know, but who wants to invite us to a free steak dinner where they can provide us with vital information about our financial future.
Here is a reality that appears nowhere on these fancy invitations: The purported investment professional will be paid a big commission by the insurance company if they convince you to buy a big indexed universal life policy.
From my perspective, this is comparable the long-gone days of you paying a big commission to a stockbroker for getting you to buy a stock he or she was recommending. By definition, this activity (whether stock or insurance) is a sales activity.
Competent and ethical fee only investment professionals do not engage in this type of commission-based sales activity.
For confirmation of this conflict of interest, ask a purported investment professional who also sells insurance what they admit in writing in their required filings with the Securities and Exchange Commission (SEC). I will bet you a steak dinner that it reads something like the following: This represents a conflict of interest because it gives an incentive to recommend products based on the commission received. Unfortunately, this disclosure is not on the invitations and is not discussed at the event.
Usually, to mitigate how problematic this conflict is, these purported investment professionals tell the SEC that clients have the option to purchase insurance through another financial professional. Unfortunately, this disclosure is not on the invitations and is not discussed at the event.
Although we are troubled by virtually all sales-based activity in the investment world, we are especially troubled when we see a purported investment professional selling commission-based products to clients while simultaneously claiming that they are acting in the client’s best interest as fiduciaries.
If you or someone you know has been inappropriately pitched and sold significant amounts of life insurance, please contact Vernon Litigation Group today. Our financial litigators are available to discuss your case in a no-cost, confidential consultation.
Vernon Litigation Group is based in Naples, Florida, and has been successfully representing clients throughout the United States against insurance companies, trust companies, banks, financial advisors, and investment firms for decades.
Visit our website at http://www.vernonlitigation.com/ or contact Vernon Litigation Group by phone at 1-239-319-4434 or by e-mail at info@vernonlitigation.com to speak with a representative of Vernon Litigation Group.