FINRA Fines Park Avenue Securities $300,000 over Variable Annuity Sales
According to a Letter of Acceptance, Waiver & Consent, The Financial Industry Regulatory Authority Inc. has censured Park Avenue Securities and fined the firm $300,000 for problems in its supervision of variable annuity sales.
FINRA said that from Jan. 1, 2013 through March 3, 2015, Park Avenue allegedly failed to establish, maintain and enforce a supervisory system concerning multi-share class variable annuities.
Park Avenue purportedly sold approximately 12,732 variable annuity contracts, during that time period. Almost 2,600, or roughly 20%, were apparently L-share contracts that had shorter surrender periods and carried fees typically between 35 and 50 basis points higher annually than those of the most commonly sold B-share contracts.
Park Avenue was also allegedly remiss in providing training to its brokers on the features of the various share classes and the associated fees and surrender charges, according to FINRA. Additionally, they purportedly did not provide them with adequate information to compare share classes to make suitability determinations.
Further, Park Avenue purportedly had no surveillance procedures to determine if any of its representatives had potentially inappropriate rates of variable annuity exchanges, according to FINRA.
Park Avenue Securities agreed to produce a written certification within 90 days. The firm reportedly said that it had completed a review of its applicable systems and procedures for reviewing VA sales.
Investigating Potential Claims
The White Law Group is investigating the liability that Park Avenue Securities may have for losses sustained by their clients. Brokerage firms are required to adequately supervise their agents to ensure they are complying with FINRA rules. If it is determined that the broker dealer failed to supervise their agents, they can be held responsible for losses in a FINRA arbitration claim.
Are you concerned about your investments with Park Avenue Securities? The attorneys at The White Law Group may be able to help you. For a free consultation with a securities attorney, please call (888) 637-5510.
The foregoing information, which is all publicly available on FINRA’s website, is being provided by The White Law Group. The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.
For more information on The White Law Group, please visit www.whitesecuritieslaw.com