Variable Annuity – A License to Steal? Unsafe at Any Speed?

STOCKBROKER LAW - Posted on October 11, 2011

In the past several years, we have seen the theft of millions of dollars of
contractual benefits, assets, and coverages from variable annuity contracts issued by prominent,
multi-billion-dollar financial services and insurance conglomerates, such as The Hartford and Nationwide
Life Insurance Company. The scheme of the now-convicted felon and Appointed Agent for Hartford
Life Insurance Company and Nationwide, one Matthew J. Ryan, exploited numerous weaknesses in the
operations, administrative, supervisory, compliance, and securities-related procedures at The Hartford
and Nationwide, which went undetected for well over five years.

The first step of this scam included a form which the clients were asked to
sign for the purpose of transferring, distributing, surrendering, and/or rolling over funds from
Nationwide or The Hartford to new companies (American Integrity and Prime Rate and Return). The
transfer forms were sketchy at best, containing numerous grammatical errors, and were otherwise
non-regulatory and non-compliant. Further yet, these two bogus companies were clearly not
authorized to accept funds in a trustee-to-trustee transfer required for subject IRA/qualified
account-type transactions in question. (http://www.irs.gov/pub/irs-tege/nonbank_trustee_list.pdf).

Notwithstanding thousands of transactions and events, The Hartford and
Nationwide, companies, for which now-convicted felon Matthew J. Ryan served as an Appointed Agent,
repeatedly honored the bogus transfer documentation without detection until the late spring of
2010.

Are your variable annuities safe? Certainly not, if you presently hold
a variable annuity subject to the same fraud, administrative, operational, compliance and supervisory
review processes, procedures, and practices followed by The Hartford and Nationwide.