Advisor Fights SEC in Annuity Switching Case
July 25, 2023 by Jeff Berman
The Massachusetts advisor who was charged by the Securities and Exchange Commission in March with defrauding clients as part of an annuity replacement scheme requested that the case be dismissed, arguing that, among other things, he was acting as an insurance agent and not an advisor, which means he didn’t violate the Investment Advisers Act of 1940.
In a complaint filed March 17 in U.S. District Court for the District of Massachusetts, the SEC alleged Jeffrey Cutter, 55, and his firm, Cutter Financial Group, recommended their advisory clients invest in fixed indexed annuities that paid Cutter a significant upfront commission without adequately disclosing his and CFG’s financial incentive to sell those products.
Click HERE to read the full story via ThinkAdvisor
Wink’s Moore on the Market: When I first read about the Cutter case, I knew it was going to be a big deal.
After all, insurance agents who have AUM account for a great deal of annuity sales.
This is a case where an RIA sold commissioned annuities, and was allegedly not disclosing conflicts of interest.
I wonder what the long-term implications of this case may be on annuity salespeople.
Read here, for the latest:
SN: Thanks for the update Jeff Berman with ThinkAdvisor. -sjm
