Commonwealth Financial Network Files Lawsuit and FINRA Arbitration Claim Against Ohio National Life Insurance Company for Fraudulent Variable Annuity Scheme

Posted on November 19th, 2018 at 9:49 AM
Commonwealth Financial Network Files Lawsuit and FINRA Arbitration Claim Against Ohio National Life Insurance Company for Fraudulent Variable Annuity Scheme

From the Desk of Jim Eccleston at Eccleston Law LLC:

In an unprecedented move, Ohio National Life Insurance Company (Ohio National) announced that starting mid-December the company will be terminating its selling agreements with brokerage firms and ceasing payments on all brokers’ trail commissions on variable annuity sales.

In response, broker-dealer Commonwealth Financial Network (Commonwealth) has brought a lawsuit in federal court in Massachusetts seeking an injunction to maintain the status quo before the December termination date.

Additionally, Commonwealth simultaneously filed a FINRA arbitration claim against Ohio National, alleging that the insurer orchestrated an unlawful scheme to get rid of unprofitable variable annuities sold with a guaranteed minimum income benefit rider.

More specifically, the FINRA arbitration complaint states that earlier this year, National Life offered its clients the opportunity to exchange their variable annuities for a different product, which encouraged brokers to facilitate the exchange and collect additional commision payments.

However, National Life’s exchange offer ended up being largely unsuccessful and in order to make up for lost profits, the insurer announced in September its plan to terminate its selling agreements with brokerage firms and cease payments on brokers’ trail commissions on variable annuity sales.

Moreover, Commonwealth further argued in its complaint that Ohio National will be unjustly enriched as a result of its actions on two fronts: Ohio National will save money on commissions payments to brokers and the insurer will collect additional surrender charges when clients decide to surrender their variable annuity policies.

Eccleston Law is investigating the alleged fraudulent activities of Ohio National Life Insurance. Those with information should contact our law firm.

The attorneys of Eccleston Law LLC represent investors and advisors nationwide in securities and employment matters. The securities lawyers at Eccleston Law also practice a variety of other areas of practice for financial investors and advisors including Securities FraudCompliance ProtectionBreach of Fiduciary DutyFINRA Matters, and much more. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.

Related Attorneys: James J. Eccleston

Tags: james eccleston, eccleston law, eccleston law llc, eccleston, annuity scheme, lawsuit, commonwealth financial network, ohio national life insurance company

Return to Archive

TESTIMONIALS

Previous
Next

Jim, Stephany and the whole team were a God send.  We felt like we were put into a situation where we had no advocate. Jim’s team came in with a strong, well laid out strategy on how to get our story heard. Where our outside compliance company had no ability to help, our Broker Dealer was impenitent, and the regulators were aggressive pursuing vague rules, Jim came like a barricade against an assault we did not understand. Though you pay member dues to be affiliated with FINRA and a B/D, you have no voice. The only thing that is truly heard in this un-level playing field is a bulldog’s bark like Jim’s. I would encourage anyone to call Jim and his team to find a real ally in the tough and complicated world of securities regulation. They are truly the best.

Greg P.

LATEST NEWS AND ARTICLES

April 24, 2024
RIA Insurance Claims Skyrocket

A recent analysis by Golsan Scruggs reveals a staggering 231 percent increase in errors-and-omissions (E&O) liability claims among registered investment advisor (RIA)
insurers.

April 23, 2024
Surge Predicted in Regulation Best Interest Cases

According to a recent analysis, Reg BI-related actions quickly have ascended to the top five issues for FINRA, with fines totaling $6 million in 2023.

April 22, 2024
FINRA Fines Independent Broker-Dealers Over Cybersecurity Lapses

The Financial Industry Regulatory Authority (FINRA) has imposed fines and censured independent broker-dealers Osaic Wealth and Securities America for cybersecurity deficiencies that led to hackers accessing the private information of more than 32,000 customers.