What Did Your Brokerage Firm or Investment Adviser Do Wrong With GWG
Published On: May 2, 2017

We’ve represented dozens of Ameriprise (formerly known as American Express)and other brokerage firm clients in arbitration claims for unsuitable investment recommendations in variable annuities. Variable annuity sales have been a major source of arbitration claims and lawsuits against the firm and other brokerage firms as well in the last 10 years.

Few products pay as well as variable annuities do. Huge commissions often provide a compelling incentive for financial advisors to jam a variable annuity into a client’s account even when it might not be appropriate. Huge surrender charges and unsuitable, high risk sub-accounts many times lead to financial ruin for the victims who were recommended a variable annuity. Especially problematic are sales where significant concentrations of the client’s portfolio are in a variable annuity.

Ameriprise was recently drilled in a FINRA arbitration claim for variable annuity sales. A Minnesota client was recently awarded $470,000 for sales abuses by an Ameriprise financial advisor? Why? Variable annuity sales. The client was awarded part of his losses, attorney fees and sanctions.

The client alleged the broker sold $2 million of unsuitable and inappropriate variable annuities. A claim in the lawsuit was also made against the brokerage firm for not supervising. As is often the case with variable annuity claims, the client was over the age of 65 (77 years old).

There are very few times when a variable annuity is appropriate for a client who is over the age of 65. Many brokerage firms completely prohibit sales of variable annuities to those over the age of 65.

How did Ameriprise and the broker defend the lawsuit? As is usually the case in FINRA arbitration claims, the firm argued the client was sophisticated and received full disclosure on the risks of the variable annuity. Often in these sorts of cases, the firm will put the client on trial and argue the client should have known better. These defenses were mostly rejected in the arbitration claim.

FINRA arbitration claims involving variable annuities have soared in recent years. According to FINRA own statistics, variable annuity claims have increased from 47 in to 123 in 2009. We expect to see a similar surge in 2010.

Arbitration claims filed at FINRA is the weapon of choice for clients who have sustained losses in variable annuities. To determine if variable annuity losses can be recouped against Ameriprise or other brokerage firms, please contact us for a no obligation consultation.


The posting on this site are mere OPINIONS and NOT statements of fact in any way whatsoever. The information should not be relied upon and there have been no findings made against the firms or individuals referenced on this site. In addition, this Blog is made available for educational purposes only and incorporates information from the web as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and Stoltmann Law Offices (161 N Clark Street 16th Floor Chicago, IL 60601). The Blog opinions should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.


Chicago Investment Fraud Attorneys Offering Nationwide Representation to Investors

If you have suffered financial losses because of the negligence or fraud of your financial advisor or broker through unsuitable investment recommendations, over-concentration, churning, misrepresenting risks, conversion or selling away, you have legal rights and options to pursue recovery of those losses.

Stoltmann Law Securities Investment Fraud Attorneys