David Lerner Associates Fined $400K, Suspended Over Annuity Sales

David Lerner Associates has been fined $400,000 and suspended for 30 calendar days by the NASD for not complying with a New York State Insurance Department regulation regarding replacement sales of variable life insurance and variable annuities from November 1998 to February 2004.

David Lerner Associates has been fined $400,000 and suspended for 30 calendar days by the NASD for not complying with a New York State Insurance Department regulation regarding replacement sales of variable life insurance and variable annuities from November 1998 to February 2004. In addition, the NASD – which considers violations of state law as violations of its own regulations – fined and suspended for 20 business days both Martin Lerner, executive v.p. of sales and Russell Moss, assistant v.p. and director of insurance services.

“The firm’s routine circumvention of the regulation denied investors the required opportunities to fully consider and understand” important investment decisions, the NASD said in a release. The agency found that during the period in question, David Lerner’s 527 variable life insurance replacement sales generating revenue of more than $3.43 million and at least 259 variable annuity replacement sales with revenue of more than $1.37 million.