by Brian Mahany
A.G. Edwards has settled charges brought by the Missouri Securities Division. The state claimed that the firm sold variable annuities to elderly clients without keeping proper records. The firm agreed to pay $755,000 but did not admit wrongdoing.
What does all this mean?
According to the Missouri Secretary of State, the investigation began after an 81-year-old resident complained about A.G. Edwards (now a part of Wells Fargo). The state believes that the company sold variable annuities to older Missourians without proper documentation.
Regulators require documentation to insure that purchasers of annuities are not being placed in unsuitable investments or having their accounts churned simply so the stockbroker can make excess commissions. Without documentation, it’s hard for the government to insure compliance.
As part of the settlement, A.G. Edwards is paying back restitution of $381,993 to 31 residents. The remainder of the moneys is penalty going to the state.
Although other states have not brought their own actions against the firm, it is a safe guess that more elderly in other states may find themselves in the same predicament. Without the documentation, of course, it is much harder to prove negligence or wrongdoing by the brokers.
If you or an elderly relative has lost money or suffered fraud at the hands of a stockbroker, financial planner, investment advisor or brokerage firm, contact an experienced securities lawyer. Financial professionals must consider the age, sophistication and financial health of their clients when recommending annuities or other investments.
Mahany & Ertl is a full service law firm concentrating in investment fraud, securities arbitrations and asset recovery. From our offices in Milwaukee, Detroit and Portland, we have helped people across the U.S. For more information, contact attorney Brian Mahany for a no obligation, confidential consultation. Brian can be reached at (414) 704-6731 or at