The New York State Insurance Department (NYSID) said that Citigroup Inc.-affiliated insurance agencies paid $2 million in fines for duping consumers of retirement and wealth-management products.
According to the NYSID, areview of Citicorp Insurance Agency Inc., Citicorp Investment Services, and SBHU Life Agency Inc. found clients had their policies or contracts replaced after receiving inaccurate or insufficient information about the products and fees.
“This major fine reflects the seriousness of these violations,” Superintendent James Wrynn said in the statement. “It is imperative that consumers, especially seniors, receive a full explanation of the pros and cons of replacing a life insurance policy or annuity contract so they are not financially harmed.”
The agencies agreed to address violations, fix their complaint processes and file reports with the department outlining their efforts, Wrynn said. Citigroup, based in New York, is the third-biggest U.S. bank by assets.
“We are pleased to have this matter resolved,” Citigroup said in a statement. “The examination, which covered activity between 2003 and 2007, found certain inadvertent violations and other issues under the Insurance Law and Department Regulations. We have taken appropriate steps to address the Department’s concerns.”