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Comprehensive Asset Management Agrees to Pay $475K Fine for Annuity Abuse Charges

By Erwin J.Shutak, Esq.  of Shustak Reynolds & Partners, P.C. posted on Monday, December 28, 2015.

New Jersey based Comprehensive Asset Management and Servicing, Inc. has agreed to pay FINRA a $475,000 fine to settle allegations that the firm failed to reasonably supervise the sales by its representatives of variable annuity products. FINRA charged that between 2008 and 2012, the firm “failed to establish, maintain and enforce a supervisory system and procedures reasonably designed to supervise variable annuity transactions”.

Specifically, FINRA alleged the firm in some cases failed to obtain customer information such as age, investment experience and objectives. The firm also did not implement controls so the annuity applications were forwarded promptly to a principal for approval, and also failed to ensure all prospective purchasers received a prospectus.

FINRA also is in the process of seeking a steep fine from MetLife, Inc., the largest U.S. insurer, for its violations relating to the sale of variable annuities.

Annuities are high-commission products that are very complex and not appropriate for most investors. Annuities traditionally have been the subject of many allegations of abuse and fraud.

Shustak Reynolds & Partners, P.C. has extensive experience in the area of securities and financial services law and routinely counsels investors, brokers, broker-dealers and registered investment advisors. For more information  contact Erwin J. Shustak, Esq, Managing Partner, at 619.696.9500 or via email at [email protected] or visit our web site at www.shufirm.com

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