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Ask Law Educator, Esq. Your Own Question
Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Consumer Protection Law
Satisfied Customers: 116754
Experience:  Attorney experienced in commercial litigation.
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My son's dad had passed away when he was 17 leaving him with

Customer Question

my son's dad had passed away when he was 17 leaving him with $280000 in life insurance. We was referred to a financial advisor and told him we wanted put the money in a safe place that my son will have after college
JA: What state are you in? It matters because laws vary by location.
Customer: hon hawaii
JA: Has anything been filed or reported?
Customer: he advised my son to by a 10 annuity pay out whole life insurance . at $150000 for 900000 policy. We kept on asking if we will be able to take out the money at 5 years or 10 years if needed and if the insurance policy will still be active. He said yes at every meeting.
JA: Anything else you want the lawyer to know before I connect you?
Customer: now my older son became a agent with a different company and his mentor immediately asked to look at it and , we found out that if we took out the money the insurance will be voided. We can only take out a loan We felt deceived. and felt that Prudential and the agent shouldn't have approved the policy based on the suitability rule. but they feel it was suitable. we are a very low income family and i wanted my son to have something to start his life after college.
Submitted: 8 months ago.
Category: Consumer Protection Law
Customer: replied 8 months ago.
WE decided to file with the DCCA , but Mass Mutual's lawyer said the policy was suitable and we are wasting our time. wasn't the suitability rule created for ignorant/ naive people like us , so agents don't take advantage of us? The annuity created to pay out the life insurance is a .03% interest. I feel the agent created this insurance to pay himself out on both ends. In filing the claim , can we ask for 3% compounded interest lost if the money was invested in a regular annuity.
Customer: replied 8 months ago.
or bonds . I am so disappointed in the agent , I really felt he had our best interest in his heart.
Customer: replied 8 months ago.
How would I word the complaint ? We would like our $150000 back. The policy is 2 years old.
Expert:  Law Educator, Esq. replied 8 months ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
FINRA Rule 2111, states a broker has a duty to obtain sufficient information about a client to provide proper (suitable) investment advice to the client. Suitable, does not mean the best advice or even the best alternative, it merely needs to be reasonable advice based on the circumstances. While the policy may be a reasonable policy and contain reasonable and standard terms, that is not your argument, your argument was that since you made known to the broker that your son wanted access to the money, the investment was not suitable based on his age and certainly was not explained properly given your son's extreme inexperience at the time of the investment.
You cannot seek to change the annuity contract, you would have to sue the broker under their errors and omissions policy for providing your son a policy that caused him a financial loss. Essentially, you have to go after the broker for negligence (malpractice) in failure to follow suitability rules based on information you provided to him and seek any losses or damages from the broker, but the policy/annuity itself would end up having to stay in place.
You should not be pursuing this type of case pro se (well your son would have to pursue it as he is the victim and you cannot represent your son in a legal matter) and your son needs to seek out an investment law attorney to assist in representation on this case.
Customer: replied 8 months ago.
Is it worth it to sue ? Seems like a pain in the ass , maybe we should just accept it. Finra doesn't deal with insurance only securities.
Expert:  Law Educator, Esq. replied 8 months ago.
Thank you for your reply.
Depending on the actual type of annuity, FINRA does regulate those, such as variable annuities which are a hybrid investment insurance tool. As far as suing, if the plan is reasonable, even though not suitable for your son, suing is going to be a costly and lengthy process and could yield minimal results because you have to prove the amount of money he lost through the broker's negligence in putting him in that plan.
Customer: replied 8 months ago.
We decided to ask DCCA to review our case. Can mass mutual sue us or is there anything I should be aware of that can happen if we did this?
Customer: replied 8 months ago.
We cannot afford a lawyer so is there any harm in asking the commissioner to review?
Expert:  Law Educator, Esq. replied 8 months ago.
Thank you for your reply.
Mass Mutual cannot and will not sue you for making a complaint.
There is no harm in asking the commissioner to review.
Please understand, the experts are not employees of this site and as such if customers do not leave positive feedback, experts get no credit for time spent with customers. This can also prevent customers from getting assistance from experts in the future on other matters. Thank you for understanding (many customers do not know and it is not well explained by the site to customers).

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