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Why Your Survival Guy Eschews Annuities

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Yet another reason Your Survival Guy eschews annuities. Annuities can be pushed by opportunistic salesmen. They are often loaded with fees, and are an insurance product. Mark Maremont and Leslie Scism report in The Wall Street Journal:

Massachusetts securities regulators said they are investigating a unit of Citizens Financial Group Inc. over its sales of a savings product offered by an insurer controlled by now-indicted financier Greg Lindberg.

News of the probe follows an article published this week in The Wall Street Journal, which reported that tens of thousands of people, many of them retirees, had a total of $2.2 billion of their money frozen since 2019 amid the implosion of Mr. Lindberg’s insurance empire.

Citizens Securities, whose representatives worked in many Citizens Bank branches, was a major seller of annuities from Colorado Bankers Life Insurance, the biggest Lindberg insurer. Colorado Bankers ramped up sales of fixed annuities, a product akin to a bank certificate of deposit, in 2017 and 2018, not long after Mr. Lindberg acquired it, according to the insurer’s regulatory filings.

The probe was confirmed by a spokeswoman in Secretary of Commonwealth William Galvin’s office, which regulates securities brokers in Massachusetts. The spokeswoman said the investigation started recently and also is focusing on individual Citizens Securities brokers but declined to provide other details.

“As with any investigation or potential investigation we would decline to comment,” a spokesman for Citizens Financial said.

The alleged wrongdoing by Mr. Lindberg “is a matter of large-scale criminal fraud that impacted many investors,” the spokesman said. “It is very unfortunate that our customers and others have suffered as a result of this situation and we are committed to doing what we can to help alleviate the impacts, including offering liquidity programs for customers who are experiencing hardship.”

Mr. Lindberg was indicted last month on federal fraud and conspiracy charges, which alleged he loaned $2 billion of his insurers’ funds to companies in his private conglomerate while allegedly siphoning off large sums to finance his lavish lifestyle. He has pleaded not guilty and is out on bail. A Lindberg spokeswoman has said that no insurance company funds have been used for Mr. Lindberg’s personal expenses.

Action Line: Stick with owning your own portfolio of individual stocks and bonds. When you need help, let’s talk. In the meantime, click here to subscribe to my free email club.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.
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