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Any time you have a financial services company marketing exclusively to retirees and elderly people, it raises questions

We work with many qualified financial planners to assist clients with comprehensive estate and financial planning. But we don’t work with everyone, and sometimes we see unscrupulous sales methods employed that take advantage of trusting clients, particularly the elderly. Just such a case is brewing now in Indiana, where an insurance brokerage was disciplined for the unauthorized practice of law – and is now the defendant in a class-action lawsuit.

            According to insurancenewsnet.com, the insurance brokerage used estate planning as the hook for a lucrative business selling other insurance products, including annuities. Sadly, this is not an unfamiliar tale. Apparently, some clients not only purchased inappropriate estate plans, but paid huge tax penalties after they cashed in valuable stocks to buy the firm’s annuities.

The estate planning packages were sold using what the Indiana Supreme Court called “an entirely one-sided ad delivered in such a way so as to likely alarm the customer.”

            Here are five tips to help you (or a loved one) avoid falling victim to similar scams:

-          Don’t Let Anyone Rush You. One of the ways scammers get their victims is by rushing them into making decisions.

-          Don’t Let Anyone Scare You. Scare tactics are common among scammers. If the product or service is valid, it won’t have to be sold with screaming headlines or scare tactics.

-          Be Suspicious of Anyone Who Pressures You to Sell Your Investments to Buy Theirs. It might be a good idea, but check with an objective third-party professional before making the move – such as your CPA or attorney.

-          Check References. Before buying any kind of financial product, check the references of both the agent and the company behind him. Check with your friends, family and business acquaintances, as well as with professionals you know and trust, such as your CPA or attorney.

-          Consult Trusted, Objective Advisors. Anyone can be fooled, and there’s no shame to being fooled by an expert scammer. Before you sign on the dotted line, take the time to consult a trusted – and objective – advisor. The opinion of a qualified, disinterested third party who has nothing to gain or lose by the transaction could be your best protection.


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