Allianz Deferred Annuity and Others Schemes Investigated

According to recent reports by the North American Securities Administrators Association (NASAA), state securities regulators in the last year alone have received over 11,000 investor complaints of various money scams, including the consumer complaints of Allianz annuity scams.

These complaints have led regulators to conduct 4,853 investigations into new and pervasive scams across the U.S.

While many of the scams investigated generally include the tried-and-true Ponzi schemes, fake private stock offerings, real estate investments, deferred annuities fraud, and oil schemes, a new scheme that has been used by scammers has been Crowdfunding schemes, making it a top concern for investigating officials.

What is Crowdfunding?

Crowdfunding is a relatively new way to raise money for small businesses and social causes via the web and has become quite popular over the last couple years.

Scammers have taken advantage of this trend and the fact that the 2012 Jumpstart our Business Startups Act (JOBS) has allowed for less regulation when it comes to raising money for small businesses.

Now, consumers must be concerned if they are investing in a legitimate business or cause when participating in crowdfunding, or if they are being scammed of their hard-earned money.

According to Vermont’s deputy securities commissioner Michael Pieciak, “Crowdfunding is a good way for small businesses to raise money locally,” but because of con artists abusing this form of fundraising, many individuals may be wary of crowdsourcing.

Additionally, the NASAA states that should an investor fall prey to a crowdsourcing scam, there is limited legal liability and little chance for recourse.

Annuity Fraud Allegations

While schemers are always looking for new ways to con people out of their cash, there are some methods that are used over and over again because they often work and bring in a pretty penny for the con artist.

Another scheme that is still popular today is annuity or deferred annuity scams, which target older or elderly investors looking to secure a comfortable retirement fund.

Allianz Life Insurance Company of North America is one of the biggest life insurance companies currently under investigation for investment fraud because of their deferred annuity products.

Allianz annuities, also referred to as a two-tier annuity, is an unusual annuity product that is allegedly harmful to investors and a veritable cash cow for the insurance company. According to reports, an Allianz annuity is a type of deferred annuity that promises investors a greater value and higher returns for their annuity investments, but only if consumers meet specific requirements.

The reason these Allianz annuity products are referred to as deferred annuities is because investors must agree to not refrain from annuitization—that is, taking money from the investment account in a serious of periodic payments by Allianz— for at least the first five years of the annuity policy.

Furthermore, Allianz annuity purchasers must also agree to then take the deferred annuity payments over a period of at least ten years.

According to reports, however, Allianz has not kept its end of the bargain with its consumers and applied a “haircut” during the annuitization years 6 through 10 after deferring for the first five years. The “haircut” took off about 6 percent from investors’ accounts and resulted in lower annuity payments than expected.

Additionally, severe penalties were imposed by Allianz on investors who annuitized early, sometimes resulting in a loss of as much 50 percent of their annuity fund.

NASAA recently held an annual conference in Puerto Rico where annuity fraud was a popular topic. The securities association and its regulators are concerned that older investors will easily fall prey to Allianz and other insurance companies deferred annuity scams, leaving them high and dry when these elderly consumers need to access their annuity fund earlier than expected because of health issues and other unexpected life costs.

If you invested in a deferred annuity offered by Allianz and believe you are not receiving the returns promised, you may be eligible to file an Allianz annuity lawsuit or join an Allianz class action lawsuit.

Get a Free Life Insurance Claims/Annuity Fraud Lawsuit Review

If you or your loved one purchased a bonus annuity, life insurance policy or Medicaid qualified annuity and it did not turn out as promised, you may need to have an investment fraud lawyer review the policy, the payments, and the potential benefits. You may be surprised at what they find, and you may even qualify for financial compensation beyond what the policy promised.

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