Conseco Says It May Face Enforcement Action
Conseco Inc., the life insurer that emerged from bankruptcy protection in September, said Friday that New York Atty. Gen. Eliot Spitzer may take enforcement action against the company for alleged improper trading by holders of variable annuities it sold.
Conseco also said it received a so-called Wells notice this month from the Securities and Exchange Commission, meaning that enforcement action is likely. The company, based in Carmel, Ind., disclosed the three-month-long investigations this month.
Conseco, which sold its variable annuities business to Inviva Inc. in 2002, said in a filing with the SEC that it believed the former unit, called Conseco Variable Insurance Co., had violated no federal or state law before its sale “based on information obtained and supplied to the investigators to date.”
Some employees have received subpoenas relating to duties they’d previously had with respect to the annuities sales, the filing said. Conseco spokesman Jim Rosensteele declined to comment further.
Variable annuities are retirement savings contracts in which premiums are invested in mutual funds offered by life insurance companies.
Conseco shares fell 6 cents to $22.70 in New York Stock Exchange trading.
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