FINRA Fines Fifth Third Securities $4 Million For Convincing Clients to Swap Annuities for Unsuitable Ones

Posted on May 10th, 2018 at 10:10 AM
FINRA Fines Fifth Third Securities $4 Million For Convincing Clients to Swap Annuities for Unsuitable Ones

From the Desk of Jim Eccleston at Eccleston Law LLC:

FINRA has fined Fifth Third Securities $4 million for misstating variable annuity exchanges in order to make the exchanges appear more beneficial to its customers. FINRA has also ordered Fifth Third to pay approximately $2 million in restitution to customers involved in its variable annuity practices.

More specifically, from 2013 through 2015, Fifth Third overstated the total fees of their existing variable annuities and failed to disclose that the existing products had an accrued living benefit value which their customers would forfeit upon executing the proposed exchange.

In addition, FINRA determined that Fifth Third failed to adequately train its registered representatives to sell its variable annuities and failed to ensure that its registered reps obtained accurate information on the products at hand. 

Overall, FINRA found that Fifth Third’s principals approved approximately 92% of variable annuity applications submitted for review because of the firm’s supervisory deficiencies.

Investors who purchased variable annuities from Fifth Third may have a cause of action under state securities laws and other causes of action to rescind those purchases.

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: Eccleston, Eccleston Law, Eccleston Law LLC, James Eccleston

Return to Archive

TESTIMONIALS

Previous
Next

I am grateful to have found an outstanding law firm that specializes in securities matters. My lawyers were extremely knowledgeable, diligent, and are skilled litigators. No stone was left upturned. As a result of their experience and tenacity, the arbitration proceeding was dismissed in my favor.

Michael E.

LATEST NEWS AND ARTICLES

February 23, 2024
Advisor Accepts Industry Bar Amid FINRA Probe into Outside Business Activities

John A. Dougherty, a veteran advisor with 23 years of experience, agreed to an AWC (Acceptance, Waiver, and Consent) after refusing to cooperate with a regulatory investigation into allegations of undisclosed outside business activities.

February 22, 2024
Key Considerations for Advisors When Assessing the Financial Soundness of Annuities

While rating agencies like Fitch and S&P Global Ratings generally highlight the strength of annuity issuers, advisors still should scrutinize certain factors in their assessment process.

February 21, 2024
SEC Alleges Fraud Against Morgan Stanley and Former Executive in Block Trading Business

As reported by the Wall Street Journal, the Securities and Exchange Commission (SEC) has charged Morgan Stanley & Co. LLC and its former head of equity syndicate desk, Pawan Passi, with a multi-year fraud involving the disclosure of confidential information related to block trades.