FINRA fined UnionBanc Investment Services of Glendale, California $100,000 for failing to adequately supervise variable annuity sales, including recommendations to replace or switch variable annuities that had living benefit riders.
According to AWC #2019062972401, UnionBanc's supervisory failures pertained to its variable annuities business, since FINRA requires more comprehensive and targeted protections due to the complex nature of VA products.
The findings state that UnionBanc failed to detect that certain information was missing from hundreds of VA exchanges involving living benefit riders and buffer annuities, thus preventing firm principals from conducting reviews that would have determined whether a reasonable basis for recommendation existed to approve the transactions.
Furthermore, the regulator accused UnionBanc of failing to ensure its customers were informed of the products' features, including buffer annuities or variable indexed annuities that still carry with them a risk of loss of principal if negative returns exceed the "buffer" amount.
Investigators concluded that because of UnionBanc's supervisory deficiencies, the firm found itself unable to determine what constituted excessive rates of exchanges and, thus, was unable to detect transactions that might have otherwise been deemed excessive or unsuitable.
If you invested with a UnionBanc Investment Services broker or investment adviser in a variable annuity, or with another registered representative who recommended you exchange a variable annuity or other complex product, and this unsuitable transaction has proven harmful to your financial interests, please call an experienced FINRA arbitration attorney at The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.