Subscribe to our mailing list

* indicates required







We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.


Stay Informed with the latest fanancialish news.




Regulatory Sanctions

6 Ways to Fleece One's Insurance Customers / Policyholders

March 11, 2019

[Photo: The Art of the Steal / 2013 movie produced by Darius Films]


by Howard  Haykin


It didn't take long for this young representative with NYLife Securities to scam his way into the 'Insurance Hall of Shame'. After NYLife caught the representative forging his customer's signature and withdrawing funds from his variable annuity account, FINRA stepped in and found additional improprieties during the course of its investigation. 
RESOLUTION: This representative was barred from the industry.



After spending 1-1/2 years with New York Life Insurance Company, this young man joined affiliate NYLife Securities in February 2016 and obtained earned his Series 6 license (Investment Company Products/Variable Contracts). Apparently, unbeknownst to others, the representative had a plan - to perpetuate customer scams he initiated during his earlier years with New York Life Insurance


Yet, the representative never got to fully execute his gameplan. Nine months after joining NYLife Securities, he was terminated for cause - the firm cited the unauthorized conversion of a customer's funds. FINRA's follow-up investigation revealed numerous conversions of funds that involved at least 6 other customers/policyholders. 



CUSTOMER COMPLAINTS.    All told, 6 customers filed complaints against this representative. Some customers/policyholders identified questionable transactions that originated in 2015 - a full year before the representative joined NYLife Securities in a registered capacity. All of the following customer complaints were settled by NYLife Securities - without any contribution from the representative.


      ►   COMPLAINT #1 - SETTLED FOR $5,556.  In November 2016, Representative forged a customer’s signature and withdrew funds from his variable annuity account without his authorization or knowledge and deposited the funds into a Navy Federal Credit Union account - which the policyowner does not own nor has he ever owned.


      ►   COMPLAINT #2 - SETTLED FOR $13,682.    Starting in June 2016, Representative withdrew funds from customer’s bank account to pay premiums for a variable life insurance policy submitted to the company without customer's knowledge or consent. Representative apparently forged customer’s signature on the variable life insurance application.


      ►   COMPLAINT #3 - SETTLED FOR $1,104.    Since February 2015, Representative opened multiple accounts without customer’s authorization, including the most recent one, a variable universal life insurance policy in October 2016.


      ►   COMPLAINT #4 - SETTLED FOR $5,459.    Representative forged policyowner’s signature authorizing the issuance of traditional life insurance policies in February 2015, July 2015 and July 2016.


      ►   COMPLAINT #5 - SETTLED FOR $5,576.    Representative withdrew funds from customer’s bank account to pay premiums for 2 universal life insurance policies she didn’t authorize.


      ►   COMPLAINT #6 - SETTLED FOR $6,460.    Representative submitted 3 applications for insurance policies without customer’s authorization and consent, prompting the Company to deduct a total of $5150 in premiums from his checking account



This case was reported in FINRA Disciplinary Actions for January 2019.

For further details, go to ...  FINRA Disciplinary Actions Online, and refer to Case #2016052434001.