Salas Wang LLC is currently investigating sales of certain variable annuities. Recently, the Illinois Secretary of State's securities department issued a notice of hearing to Thrivent Investment Management Inc. In its notice of hearing, the department alleges:
Some time before 2012, Thrivent Financial, issuer of Variable Annuities, rolled out a new feature — a Guaranteed Lifetime Withdrawal Benefit (GLWB) — added to the Variable Annuity in return for a rider fee.
The Replacement Transactions
During the period of January 2011 to June 2012 and July 2013 through June 2014, Thrivent Investment transacted, in Illinois, approximately 282 replacement/exchange transactions of legacy Thrivent Financial Variable Annuities for new Thrivent Financial Variable Annuities. In approximately 57 transactions, the investor was solicited and recommended to purchase a GLWB rider.
All of these transactions followed a similar pattern — they involved the replacement of a legacy Thrivent Financial Variable Annuity with a new one, after the surrender period had passed. Most of the replacements involved persons 50 years of age or older.
Problems with the GLWB Rider
The GLWB rider guarantees the return of the investment through a series of withdrawals for life, even if the accumulated value of the Variable Annuity is depleted. However, significant restrictions and concerns were identified:
- The investor may not begin withdrawals until age 62.
- Rider fees range from 0.50% to 0.75% (up to a maximum of 1.25%).
- Upon selection of the GLWB rider, the investor is limited in sub-account options.
- After July 2014, investors may only choose one investment option (Thrivent Moderately Conservative Allocation).
- No economic analysis was conducted to determine if the GLWB rider would benefit the client.
How to Recover Your Losses
If you were sold a GLWB rider via Thrivent, we are offering a free portfolio review to determine if you have a possible claim. Please contact us via the contact form or call Jeffrey Salas at 312.803.4963.