4 Firms Settle Over Annuities Allegations

Four companies and an individual have agreed to pay a total of $112,000 to settle allegations that they improperly marketed and sold variable annuities, a popular way to save for retirement. Allegations by the National Assn. of Securities Dealers included misleading advertising and making sales that are unsuitable for customers’ financial situations. The settlements are the first cases resulting from the NASD’s two-year probe of sales of variable annuities. The companies and the individual neither admitted nor denied the allegations. Spokesmen for several companies stressed that the NASD’s complaints were related to procedures and did not allege financial harm to customers. The four companies and their fines are: Prudential Securities Inc., $10,000; First Union Brokerage Services Inc., $32,500 (including $5,000 in restitution); Allmerica Investments Inc., $15,000; and Lutheran Brotherhood Securities Corp., $25,000. The individual, Ralph C. Evans, agreed to pay a $10,000 fine and restitution of $20,130.

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