Yet Another LPL Rep Sues Annuity Provider Over Trailing Commissions
Annuity issuer Ohio National Life Insurance Company is facing yet another lawsuit over its decision to stop paying trailing commissions on variable annuity contracts in December, with another LPL Financial broker joining the fray, according to news reports.
Jackson, Miss.-based Chris Noone filed a lawsuit in the U.S. District Court for the Southern District of Mississippi late last month, according to WealthManagement.com. He’s seeking $75,000 in damages plus unspecified interest and costs, claiming breach of contract, unjust enrichment and more, the web publication writes. Ohio National told its partners in October that it would stop paying trailing commissions on variable annuities with guaranteed minimum income benefit riders in December and offered them a buyout of their contract until February 11, according to WealthManagement.com.
Noone says in his suit that by doing so, Ohio National is breaching its selling agreement, the web publication writes.
A spokeswoman for Ohio National declined comment to WealthManagement.com on Noone’s suit specifically but says its contracts with advisors don’t cover the services an advisor provides to his or her clients.
“Specifically, there is no language in our contracts or product prospectuses that provide for this type of arrangement,” Angela Meehan tells the web publication in a statement.“While the advisor and client may have a relationship, there is no annual fee or charge that the policyholder pays to Ohio National in order to receive advisory services.”
In addition to Lance Browning, the other LPL broker who sought a class action against Ohio National, the annuities provider is facing a lawsuit from Conway, Ark.-based broker-dealer Veritas Independent Partners, which filed a suit in November, as reported.
The annuities issuer is also facing a lawsuit from Commonwealth Financial Network in a Massachusetts district court and an arbitration claim filed with Finra by Cetera Financial Group, according to WealthManagement.com.