Equitable Financial Life Insurance Company will pay $50 million to settle charges that it provided misleading account statements to investors saving for retirement, the Securities and Exchange Commission announced.
The case involved about 1.4 million variable annuity investors, most of whom are public school teachers and staff members. The SEC’s investigation found that since at least 2016, Equitable gave those investors the false impression that their quarterly account statements listed all fees paid during the period. But the statements actually listed only certain types of fees that did not occur frequently, the SEC said. More often than not, the statements listed $0.00 for fees.
“When considering how to invest their hard-earned money and save for retirement, it is essential that investors not be misled about the fees they are paying,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement. “This case should serve as an important reminder to investment firms to carefully review their statements to ensure fee information is disclosed properly.”
Equitable was found to have violated the antifraud provisions of the Securities Act of 1933. The company did not admit or deny the SEC’s findings, but did agree to cease and desist from committing or causing any future violations of these provisions. It also agreed to pay a $50 million civil penalty that it will distribute to the harmed investors. Equitable also agreed to revise how it presents fee information in its variable annuity account statements.
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