The SEC recently announced that it has found that Eric J. Brown, formerly associated with registered broker-dealer Prime Capital Services, Inc., violated various provisions of the Securities Act of 1933 and 1934 by selling variable annuities to elderly customers while failing to disclose material information, including a prohibition on Brown’s insurance license against making such sales.
The SEC also found that Mr. Brown and Matthew J. Collins, another advisor associated with Prime Capital falsified customer account forms. The SEC also found that Mr. Collins failed to reasonably supervise Mr. Brown by, among other things, allowing Brown to continue selling variable annuities despite a suspended license.
Finally, the SEC also found that Kevin J. Walsh, also formerly associated with Prime Capital, failed to disclose material information to his customers when selling variable annuities – including concealing the very type of investment Mr. Walsh was selling.
For these violations, the SEC has barred Mr. Brown, Mr. Collins, and Mr. Walsh from associating with any broker, dealer, or investment adviser.
Variable annuities are insurance contracts in which, at the end of the accumulation stage, the insurance company guarantees a minimum payment. The money invested in the annuity is invested in “subaccounts” and the remaining income payments vary depending on the performance of the managed portfolio.
Variable annuities are also high commission products, which is why these products are often at the heart of SEC investigations like the one discussed above.
If you are concerned about a variable annuity or other investment that you purchased from Mr. Brown, Mr. Collins, or Mr. Walsh, the securities attorneys of The White Law Group may be able to help. For a free consultation, please call the firm’s Chicago office at 312/238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, visit http://www.whitesecuritieslaw.com.