A judge agreed with Fireman’s Fund insurance company’s retirees who sued the employer for introducing them to “financial education seminars”.  They attended, followed the advice given and lost everything. Maybe you thought this only happened to naive older folks preyed on by slick salesmen outside the workplace. But no.  It happened to 34 long time employees and retirees of Fireman’s Fund who lost most or all of their retirement savings by being misled into risky investments.

Fireman’s Fund introduced their workforce to Successful Money Management Seminars, Inc. (“SMMS”) which gained the employees’ trust over a ten year period. The employees attended these “educational seminars” onsite at the employer’s headquarters.  They became clients of the Financial Advisors SMMS offered and did as the advisors suggested. Wouldn’t you be likely to trust someone your employer provided onsite and who held themselves out as “experts in their field”? Some employees retired early on the advice of SMMS. Others took all or most of their 401k plans, pensions and other money and followed the advice to put their savings into supposedly safe investments. Instead, these turned out to be high risk, private placements. All of them failed. The Financial Advisors were neither vetted nor monitored adequately by Fireman’s Fund or SMMS, according to the report on this case.
This is yet another form of financial abuse.  It was disguised by the large employer’s apparent approval and support of SMMS.  Although SMMS was a division of ING, which vigorously defended the allegations, Firemen’s Fund was found negligent to the tune of over $36 million in investment-related damages and over $7 million in non-investment related damages.  
This example is yet another reason to avoid “investment education seminars” no matter who is presenting them.  If an employer lets outsiders come in and entice its own retirement-minded employees and retirees to follow the advice of strangers whom no one has adequately vetted and no one is monitoring, disaster can be the result.  The seminars took place between 1996 and 2004.  The trial began in 2014 and ended in 2015.  Imagine being a ruined investor retiree with everything lost for over 10 years.  And of course the verdict will be appealed, tying up any potential payment of damages for considerably longer.
Don’t let this happen to your own clients, family and friends.  Dishonest salespeople with unsuitable investments love to pillage retirement savings.  The best takeaway from AgingInvestor.com for today is to avoid financial education seminars altogether.  If one does attend and choose to consider advice that comes from any seminar provider, get a second opinion about the proposed investment from an objective expert in the financial advice field. 
Let your working and retiree clients know about this employer sponsored educational seminar debacle.  You can help us educate everyone by sending them an email or letter using our AgingInvestor.com free sample letter form.  Just copy and paste, making it yours.  Get it here.
Until next time,
Carolyn Rosenblatt, RN, Elder law attorney
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