Michigan Cites Star Salesman at Prudential : Insurance: Regulators move to revoke the license of Anthony J. Amaradio. He has denied violating rules.
Michigan regulators have moved to revoke the license of a leading Prudential Insurance salesman who divides his time between Newport Beach and Michigan and who was hired by Prudential despite a track record of problems in a prior job.
The action comes just days after Prudential Insurance Chairman Robert Winters publicly defended the decision to hire Anthony J. Amaradio in 1991 despite a lengthy record of customer complaints, disciplinary action by regulators and pending investigations. Winters said Prudential has no plans to sever its ties to Amaradio.
On Friday, a Prudential Insurance spokesman said the company had not been notified of the Michigan charges and therefore would not have any comment. Neither Amaradio nor his lawyer, Laurence S. Schultz, responded to messages seeking comment. In interviews late last year, they strongly denied that Amaradio had violated any rules.
Prudential has been under fire for months because of an $8-billion limited partnership debacle at its Wall Street subsidiary, Prudential Securities.
In the case of Amaradio, the Michigan Insurance Bureau alleges in a long list of civil charges dated Feb. 28--and obtained by The Times on Friday--that he deserves to lose his license because “he is not honest and trustworthy.”
Amaradio is accused of violating state insurance laws by forging customers’ initials on insurance forms, using high-pressure sales tactics and misleading many Michigan customers in the 1980s while he was a salesman for the Equitable Assurance Society.
If the charges are upheld and Michigan suspends Amaradio’s license, it could lead to his suspension in California as well, California regulators have said. Amaradio also faces potential fines under the Michigan charges.
Amaradio was fired by Equitable, which in November was fined $1.5 million by the National Assn. of Securities Dealers, in part for allegedly having failed to supervise Amaradio. Equitable settled the charges without admitting or denying wrongdoing. Amaradio was hired almost immediately by Prudential. He has denied that he was fired, although documents filed with the NASD and copies of Equitable correspondence obtained by The Times state that he was.
Amaradio is facing NASD charges for alleged false advertising. He also agreed to a fine and brief suspension in a settlement of earlier NASD charges.
The Michigan charges accuse him of misrepresenting life insurance policies by falsely “describing the policies as investment programs,” “overstating the size of the investment returns the consumers would receive, and understating the length of time the consumers needed to invest to receive regular income without further investment.”
In 1986, for example, Amaradio allegedly persuaded Gregory Adams of Michigan to invest in a retirement plan he said would fully fund Adams’ retirement within three years. Instead, by 1991, Adams’ $80,000 investment had dwindled to $55,000. And Amaradio, after moving to Prudential, allegedly tried to persuade Adams to cash out his Equitable policy and shift his investments to Prudential.