Illinois Insurance Code did not bar Securities Department from investigating VA sales

By John M. Jascob, J.D., LL.M. The Illinois Securities Department had authority to investigate allegations that a broker-dealer committed fraud in the sale of variable annuities. The Illinois Securities Law authorizes the Securities Department to investigate whether registered broker-dealers and advisers have committed fraud in any business practice, even if that practice involves insurance products. Accordingly, the Illinois Court of Appeals affirmed dismissal of the broker-dealer’s complaint (Thrivent Investment Management Inc. v. Illinois Securities Department, August 28, 2018, Walker, C.). Variable annuity sales. In October 2015, the Securities Department sent notice to Thrivent Investment Management, Inc., alleging that Thrivent committed acts that could subject the firm to suspension of its investment adviser and securities dealer registrations. Among other things, the Securities Department claimed that Thrivent representatives misleadingly solicited unsophisticated…

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