Courtney Jorstad  |  December 16, 2013

Category: Legal News

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New York Life Insurance lawsuitEdna Jackson, 93, has filed a lawsuit against New York Life Insurance and Annuity Corp., claiming that the company is responsible for the alleged annuity fraud committed against her and others by wealth manager and Indiana resident Richard Schwartz, who committed suicide in August.

On Aug. 5, 2013, Jackson filed an annuities fraud lawsuit against Schwartz, seeking the money her late husband had invested for her to live on after he died. According to Edna, she didn’t receive much from the investment and she is not certain that it still exists. She sued Schwartz for $1.3 million.

Schwartz owned the investment firm The Schwartz Group and worked as a registered representative of New York Life. The annuities lawsuit claims that New York Life knew that Schwartz was committing fraud against his clients but chose to look the other way.

Several lawsuits were filed against Schwartz before his death and victims have been scrambling to figure out what options they have for recovering some of their lost funds following Schwartz’s death. If they are able to prove that New York Life is liable, they may be able to get relief. The amended complaint includes 27 plaintiffs, whose losses to Schwartz reportedly total more than $5 million.

“Richard A. Schwartz, his ex-wife Sigrid Schwartz, and his last wife, Brielle Cotterman, lived a life of opulent luxury very few people could even imagine,” the annuities fraud lawsuit states. “Together they created and controlled a dizzying myriad of LLCs and other business ventures. They truly enjoyed a lifestyle shared only by the richest and most famous.”

The plaintiffs argue that the Schwartzes’ lifestyle should have been a red flag for New York Life. Instead, the annuities lawsuit claims that New York Life elevated the agent by giving him every reward and honor it could, even though agents in larger markets did not produce as much as Schwartz.

“New York Life was on notice early on that Schwartz was not the trustworthy, rule-following man New York Life had made him out to be,” the annuities lawsuit alleges. “Still they delayed terminating him, and when they did finally fire him, they did nothing to alert Schwartz’s clients, the security regulators, or the public in general about Schwartz’s many misdeeds, which allowed Schwartz and RAS (& Associates) to continue the Ponzi scheme until the summer of 2013 to the financial ruin of many of Schwartz’s trusting clients.”

An investigation into Schwartz and his practices began in early 2011 by lead investigator Tom Nolen. According to the annuities fraud lawsuit, “Mr. Nolen found that Richard A. Schwartz was violating numerous company and industry rules. Mr. Nolen determined that Schwartz should be terminated for his misdeeds. Nevertheless, there was a faction within New York Life that did not want to terminate Schwartz because of his production. Greed apparently won out as Schwartz was not terminated until about 14 months later.”

The annuities fraud lawsuit charges New York Life with negligence, breach of fiduciary duty and violating the Indiana Securities Act.

If you or someone you know was a victim of fraudulent activity due to an annuity or life insurance policy, legal action is available to you through an investment fraud attorney. Contact the Life Insurance, Annuities Fraud Class Action Lawsuit Investigation for a free review of your case.

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2 thoughts onNew York Life Hit with Annuity Fraud Lawsuit

  1. william venard says:

    loan mod on my was charge $7500 now they r not allowed to charge for a loan. they still wont return my money

    1. Sonia velazquez says:

      I found out yesterday i’m unable to withdraw one penny from my annuities fund. I was tricked into this by Fidelity Investments. They absolutely acted in bad faith. I had told them I needed access to that money. They sold me the annuity. When I asked if I could transfer the money to my IRA rollover, they said yes.

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