Dover – An Ohio investment company has been barred from doing business in Delaware and agreed to pay a $15,000 administrative assessment to resolve a complaint brought by Insurance Commissioner Matt Denn.

In August 2006, the Department of Insurance began an investigation of Investors Union, LLC of Medina, Ohio doing business as the “Annuity Service Center.” The complaint was based on  postcards sent to Delaware residents that directed the recipients to call about “an annuity that has reached the end of its surrender period,” even though the firm that sent the card had no connection with any annuity a resident may have had.

Under a consent order finalized Monday, Investors Union agreed not to “engage in any business in Delaware without written prior approval of the Insurance Commissioner” and agreed to pay $15,000 to defray the cost of the investigation and prosecution of the case.

“The tactic used by Investors Union was misleading because the company did not, in fact, have any information about the recipients’ insurance or finances. The purpose of the postcard was simply to cause seniors to call the company, which would then refer the caller to an insurance agent that had paid Investors Union for leads,” Commissioner Denn said. “I will continue to take a dim view of solicitations like these, especially when senior citizens are the target.”

An annuity is a contract in which an insurance company makes a series of income payments at regular intervals in return for a premium or premiums a consumer has paid. Certain annuities, especially variable or indexed annuities where the consumer’s return is tied to stock market performance, have been criticized as being bad investments for seniors.

The consent order states that Investors Union “represented themselves as being in the insurance business,” “gave the false impression that [they] were in possession of information relating to the recipient’s annuity contracts and personal finance information” and “led seniors to believe that annuities were ‘expiring’ when [Investors Union] had no reason to believe that to be the case.”

Commissioner Denn said the case should serve as a reminder for people to be very careful about what they receive in the mail.

“In the last year, we’ve seen official-looking envelopes that looked like they came from the Senior Resource Center and postcards that looked like they came from an Annuity Service Center,” Commissioner Denn said. “Be very skeptical about what you get in the mail if it doesn’t specifically have the name of a company or agency you do business with or know.”