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CFO Fights Financial Fraud Against Seniors

February 17th, 2009 by flanews

Floridas Chief Financial Officer is joining forces with lawmakers to push stricter penalties for insurance agents who rip-off senior citizens.

Hear it Here: CFO Fights Financial Fraud Against Seniors

The state is reviewing hundreds of cases of financial fraud against people over 65. As Whitney Ray tells us, lawmakers are trying to toughen laws against people who swindle seniors out of their money.

To earn extra income 81-year old Bonnie Madden invested 300-thousand dollars in two annuities. The agent who helped Bonnie invest her money later convinced her to combine the two annuities into one, costing Bonnie a penalty fee, but earning her agent a 52-thousand dollar commission.

I would like to see him in a bright orange suit jump suit and silver bracelets that hold his hands together, Bonnie said.

Bonnie fell victim to twisting, a form of fraud where an agent convinces an investor to change annuities several times, costing the victim penalty payments. Lawmakers filed legislation to stop twisting.

This is a get tough bill. It provides criminal penalties and that will serve as a strong deterrent, said House Democrat Keith Fitzgerald.

The legislation increases misdemeanor penalties to a felony for insurance agents caught twisting the annuities of people over 65. The bill extends the automatic refund period for seniors from 14 days to 60, to give family members enough time to review the investment.

It also caps penalties for pulling money out early. Floridas Chief Financial Officer says right now seniors are getting tricked into buying 15 year investments.

We recently had a 90 year old woman who was sold an annuity with a surrender charge of 15 years. Thats just wrong, said Sink.

Life insurance companies killed similar legislation last year. Insurance lobby Groups are supporting the efforts, but worry that some restrictions could keep wealthy seniors looking to gamble from switching annuities.

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