A former unit of Conseco is reportedly in hot water over improper trading inside its variable annuities. Both the SEC and the New York State Attorney General's Office (NYAG) are investigating activity in accounts offered by Jefferson National Life Insurance Company
. The insurer revealed the probes in an SEC filing Friday.
The insurer also revealed that the SEC's Northeast Regional Office sent it a Wells notice on March 12 of this year. The SEC typically notifies targets of potential action through Wells notices and provides them with an opportunity to respond.
The SEC staff said in the Wells notice that they may recommend a civil injunctive action against Jefferson National based on alleged market-timing in variable annuity contracts. The insurer also disclosed that Eliot Spitzer told it his office could bring similar charges under the New York Martin Act.
Jefferson National is an affiliate of Inviva Inc. The privately-owned company purchased the insurer from Conseco in October 2002. The SEC and NYAG notified Conseco in January that they are considering enforcement actions based on market timing in variable annuity policies. Conseco has claimed that insurer did not violate federal or state laws before it was sold to Inviva.
Sean Hanna, Editor in Chief
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