The Securities and Exchange Commission (SEC) has filed an administrative complaint against the New York based annuities firm Prime Capital Services, Inc and its parent company Gilman Ciocia.
The SEC claims that Prime Capital Services lured-in elderly investors in Florida with free lunch seminars.
The firm allegedly sold unsuitable variable annuities to the elderly investors:
The sales pitches, the SEC claims, concealed high costs, lock-in costs and made "material misrepresentations and omissions," according to the complaint.
"They used free lunches as the low-tech bait for their high-scale scheme," said SEC Enforcement Director Robert Khuzami. "These con men lured elderly and retired investors into purchasing highly unsuitable variable annuities, enriching themselves with commissions while ignoring the financial goals of their victims."
The administrative complaint names seven employees of the firm.
Source: Wall Street Journal (subscription required)
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