MN AG sues Allinaz US alleging annuity fraud
Minnesota Attorney General Lori Swanson has sued Allianz Life, a unit of German insurer Allianz (ALVG.DE: Quote, Profile , Research), claiming the company sold unsuitable annuities to seniors and that its agents misled clients about terms, surrender penalties and bonus payments. “Allianz and its agents aggressively marketed deferred annuities to seniors without regard to the suitability of the sale and without disclosing that seniors’ limited savings could be tied up for years,” said Attorney General Lori Swanson in a statement. Swanson said that Allianz had sold annuities, a retirement product which provides regular payments to the insured in return for a lump sum payment, that did not disclose to seniors that their money could be tied up for 15 years. The agents also did not tell the clients that they could not cash in their annuities early without paying hefty surrender penalties and that 10 percent payments advertised as “immediate” bonuses were not payable for up to 15 years, Swanson said. Swanson said her office was also reviewing other companies’ annuities sales practices for evidence of deceptive marketing.