September 10, 2001 (PLANSPONSOR.com) - American
Skandia Life Assurance Corporation on Monday introduced
Plus40, a guaranteed issue term life insurance
rider.
The product, funded with after-tax dollars, may help
offset income taxes due at the death of the annuitant on
rollovers from 401(k)s, 403(b) Tax-Sheltered Annuities, or
IRAs according to Skandia.
Available as an option on newly-issued variable
annuities beginning September 17, the Plus40 rider:
can pay beneficiaries a federal income tax-free
amount equal to 40% of the annuity’s account value at the
owner’s death, in addition to the annuity contract death
benefit
is available to new purchasers of the company’s
variable annuities between the ages of 40 and 75, and
coverage may continue through age 95
does not require purchasers to answer any medical
questions or undergo examinations.
Purchasers of Plus40, ages 40-75, cannot be turned
down.
August 10, 2001 (PLANSPONSOR.com)- Two pension plans
and an investment advisory firm have allegedly fallen victim
to a fraudulent trading scheme by pension fund manager Alan
Bond, to the tune of $56 million.
The complaint filed in the US District Court in
Manhattan identified the injured funds as the
Birmingham Amalgamated Transit Authority Local 725, the Old
Dominion Disability and Retirement Allowance Plan and
Baltimore-based Chapman Capital Management. Chapman has
allegedly suffered losses of more than $40 million from the
scheme.
Bond, 40, president and CEO of Albriond Capital
Management, has been charged with conducting a scheme that
directed virtually all of his profitable stock trades to
his own accounts and most of his unprofitable ones to the
accounts of those three clients. Incredibly, Bond allegedly
undertook the scheme while out of jail on a $1 million
personal recognizance bond from trading charges levied
against him in 1999.
In December 1999 Bond 8, was charged by the US
Attorney’s Office and the SEC with taking nearly $7 million
in kickbacks over five years from brokerage firms in
connection with his management of some $600 million in
customer funds. Bond allegedly directed trades to the
brokers through his former money management business, Bond,
Procope Capital Management. Bond, who has denied the
charges, was scheduled to stand trial in November.
In a separate action yesterday the SEC filed a complaint
against Bond and was successful in getting the courts to
freeze his assets, including his personal accounts, now
valued at about $5.2 million.
Some of Bond’s other clients have included the National
Basketball Association, the City University of New York and
the Washington Metropolitan Area Transit Authority.
Albriond still manages $235 million for as many 50 clients,
according to prosecutors.
Trading Places
The new allegations came to light in late July after
Neuberger Berman Inc., Bond’s broker-dealer in New York,
reported his activities to prosecutors.
From March 2000 until the end of last month, prosecutors
claim that Bond’s account grew to $6.5 million from $263,
360, a gain of more than 5,000%.
Technically, Bond directed 93% of his profitable trades
to his account and 83% of his unprofitable trades to his
client’s accounts. Prosecutors and court documents allege
that Bond’s strategy was to perform day trading and then
wait until later in the day or until the close of markets
to instruct Neuberger Berman on the direction of trades to
his accounts. According to the complaint, this tactic
allowed Bond to determine whether trades were profitable or
not.
Formally, the complaint charges Bond with six counts of
securities fraud and three counts of investment advisory
fraud. If convicted, he faces a possible maximum sentence
of 75 years in prison. Each securities fraud charge carries
a maximum sentence of 10 years while each advisory fraud
charge carries a maximum of 5 years. This is in addition to
millions of dollars in fines.
Bond’s lawyer, Ted Wells, told a number of news sources
that the new charges came as a complete surprise and until
he has had a chance to study them, cannot comment.