(For those who are unfamiliar with the case or haven’t been following it recently, you can get up to speed HERE.)
The indictment, trial, conviction, and vindication of California annuity broker Glenn Neasham has been one of the most closely-followed legal battles in recent industry history. Beginning back in early 2008, it has taken over five years to reach its ultimate conclusion; the conviction, appeal, and eventual acquittal of Mr. Neasham. However, regardless of the verdict, the repercussions of this case are still echoing throughout our industry, and have changed the way business will be conducted today, and in the future.
Mr. Neasham’s actions have been scrutinized under a magnifying glass; his intentions have been analyzed, and the man himself has been repeatedly judged, both fairly and unfairly. Even at the time of this writing, industry websites and forums are blowing up with opinions, speculation, and analyses of the ruling. While I might be tempted to throw my own two cents into the fray, I’m more concerned with what we as an industry have learned from the experience.
So, after several years of following this case, what have we learned?
Have we learned to be wary of our older clients? Have we learned to question the mental competency of every client that crosses our doorstep? Have we learned that we live in a litigious society, and that we are judged not by our actual intentions, but what an (overzealous) prosecutor can present in a court of law?
Of course not! We’ve learned that there is no such thing as too much due diligence, and that the scope of that diligence cannot be defined by what is specifically laid out on a standard annuity suitability form. We’ve learned that sometimes, even when you follow the rules down to the tiniest detail, there are still ways that things can go wrong. However, the bottom line here is simple; by taking the time to fully understand the needs of our clients, and by keeping those needs first and foremost in our minds when we make our recommendations, we fulfill our duty as financial advisors. And as advisors, our best defense centers around focusing on suitability, staying current with our continuing education, and more importantly, by documenting everything – maybe even to go so far as to videotape the meeting! By being vigilant here, we not only provide the best experience for our clients, but also provide ourselves with the best defense against the unknown.
For current industry developments or advice on best practices, give your Zenith Marketing team a call today.
For more information about Glenn Neasham, and how to protect your practice:
- “Neasham Case settled, but aftershocks continue” (ProducersWeb)
- “Neasham Looks to Uncertain Future Even After Winning Appeal” (InsuranceNewsNet)