The securities lawyers of Gana LLP are investigating customer filed with The Financial Industry Regulatory Authority’s (FINRA) against current The O.N. Equity Sales Company (O.N. Equity) broker Richard Wesselt (Wesselt). Wesselt operates his securities practice under an d/b/a entity called Wesselt Capital Group. According to BrokerCheck records, Wesselt has been subject to seven customer complaints over the course of his career and one termination for cause. The most recent customer complaint against Wesselt occurred in August 2016 and alleged that sale of variable annuity and life insurance were unsuitable. The claim alleged damages of $25,709 and settled.
Variable annuities are complex financial and insurance products. The Securities and Exchange Commission (SEC) released a publication entitled: Variable Annuities: What You Should Know encouraging investors to ask questions about the variable annuity before investing. A variable annuity is a contract with an insurance company under which the insurer agrees to make periodic payments to you. The investor chooses the investments made in the annuity and value of your variable annuity will vary depending on the performance of the investment options chosen. The primary benefits of variable annuities are the death benefit and tax deferment of investment gains.
However, the benefits of variable annuities are often outweighed by the terms of the contract that include exorbitant expenses such as surrender charges, mortality and expense charges, management fees, market-related risks, and rider costs. Brokers often solicit these products to earn lucrative up front commissions even when the product is inappropriate for the investor. In addition, some brokers will attempt to flip or switch annuities every couple of years which has the effect of further denying the investor of benefits while increasing commissions to the broker.