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In April 2010, World Group Securities was fined in excess of $850,000 as the result of the unauthorized sale of private securities in the State of Arizona.<ref>http://images.edocket.azcc.gov/docketpdf/0000110449.pdf</ref>
In April 2010, World Group Securities was fined in excess of $850,000 as the result of the unauthorized sale of private securities in the State of Arizona.<ref>http://images.edocket.azcc.gov/docketpdf/0000110449.pdf</ref>


In November 2010, the U.S Securities and Exchange Commission (SEC) ordering World Group Securities to pay, among other things, a civil monetary penalty in the amount of $200,000 for the fraudulent selling of unsuitable securities in the State of California, which were funded using home equity, derived from the refinance of the customers' homes into subprime mortgages.<ref>http://www.sec.gov/litigation/litreleases/2008/lr20768.htm</ref><ref>http://www.sec.gov/litigation/complaints/2008/comp20768.pdf</ref><ref>http://www.sec.gov/news/digest/2010/dig112210.htm</ref><ref>http://www.sec.gov/litigation/admin/2010/34-63354.pdf</ref> Eccleston Law announced publicly on November 29, 2010, that it has expanded the investigation to include all branch offices nationwide.<ref>http://financialcounsel.typepad.com/financialcounsel/2010/11/eccleston-law-launches-investigation-of-world-group-securities-.html</ref>
In November 2010, the U.S Securities and Exchange Commission (SEC) ordered World Group Securities to pay, among other things, a civil monetary penalty in the amount of $200,000 for the fraudulent selling of unsuitable securities in the State of California, which were funded using home equity, derived from the refinance of the customers' homes into subprime mortgages.<ref>http://www.sec.gov/litigation/litreleases/2008/lr20768.htm</ref><ref>http://www.sec.gov/litigation/complaints/2008/comp20768.pdf</ref><ref>http://www.sec.gov/news/digest/2010/dig112210.htm</ref><ref>http://www.sec.gov/litigation/admin/2010/34-63354.pdf</ref> Eccleston Law announced publicly on November 29, 2010, that it has expanded the investigation to include all branch offices nationwide.<ref>http://financialcounsel.typepad.com/financialcounsel/2010/11/eccleston-law-launches-investigation-of-world-group-securities-.html</ref>


==References==
==References==

Revision as of 20:46, 7 January 2011

World Financial Group
Company typeSubsidiary
IndustryFinancial Services
Founded2001 (under AEGON ownership)
Headquarters11315 Johns Creek Parkway
Duluth, Georgia 30097-1517
ProductsLife Insurance
Retirement plan
Mutual Funds
Unit Investment Trust
Annuities
Long-term care
Segregated fund
Loans
Mortgages
Debt Relief
ParentAEGON
Websitewww.worldfinancialgroup.com
www.wfg-online.com
www.wfg-online.ca

World Financial Group (WFG) is a financial services marketing organization based in Duluth, Georgia that markets investment, insurance, and various other financial products through a network of associates in the United States and Canada. WFG is a Network Marketing company that utilizes a system also known as Multi-level Marketing (MLM).[1][2] It is a wholly owned subsidiary of AEGON.[3]

History

World Marketing Alliance introduced the Business Format System (BFS) in 1992, a blueprint to help its associates build and run their business.[4] MD TV, the company's private satellite television network, was also introduced. During this period, the company expanded its operations to Canada, Taiwan, Mexico, Puerto Rico, Guam and the Philippines.[4] The company held its first convention in Las Vegas in 1992. It was attended by about 2,000 associates.[4]

On March 23, 1998, WMA Executive World Headquarters opened in Duluth, Georgia. The 100,000-square-foot (9,300 m2) building housed 500+ employees.[4]

In November 1998, WMA was fined $100,000 "for not properly supervising its sales agents" after their clients lost nearly $2 million in unregistered investments.[5] In 2000, WMA was fined $125,000 "for failing to report nearly 900 customer complaints".[6]

In June 2001, select assets of WMA were purchased by AEGON and renamed World Financial Group, Inc..[7][8] Alexander Wynaendts, chief executive of AEGON, was quoted saying about WMA that "When we took the company over, we put in place very strict regulatory and compliance procedures".[9]

Industry partners

In the United States, a sampling of WFG's numerous provider companies would include hundreds of investment companies (including mutual funds and unit investment trusts, offered through its affiliate broker-dealer World Group Securities) and various insurance and financial services-related companies, including Allianz, Debtmerica, Hartford Life, ING, Jackson National, John Hancock, Life Lock, Lincoln Benefit Life, Lincoln National, MetLife, Nationwide, National Long-Term Care Brokers, Old Mutual Financial Network, Pacific Life, Principal Financial Group, Prudential, Shaw American, Transamerica, and Western Reserve Life.[10]

In Canada, some of WFG's provider companies include Transamerica Life of Canada, Equitable Life of Canada, TD Mutual Funds, IA Clarington Investments, Fidelity Investments, AEGON Fund Management, AGF Management Limited, RBC, and Franklin Templeton Investments.[11]

Announced in March 2008, World Financial Group has teamed with Laserfiche([R]), an electronic document management company, to launch a paperless records management and Straight Through Processing (STP) platform called "Navigator" for the registered representatives of its affiliate, World Group Securities, Inc.[12]

Activity

WFG insurance lines of business are managed directly by WFG in the United States, while its investment lines of business are managed by its affiliate broker-dealer World Group Securities, Inc.

In Canada, WFG's insurance lines of business are managed by its provincially regulated subsidiary managing general agent World Financial Group Insurance Agency of Canada Inc.; while its investment and mortgage lines of business are managed by its subsidiary WFG Securities of Canada, Inc., which is a member of the Investment Funds Institute of Canada and the Mutual Fund Dealers Association of Canada.[13] WFG's Canadian head office is located in Vaughan, Ontario.

Ratings

The Toronto-based WFG was named Canada's best MGA and top firm overall in 2006 and 2007 with an IE rating of 9.3, surveys conducted by Investment Executive, a newspaper for Canadian financial advisors.[14][15]

Toronto-based World Financial Group Inc. scored top spot again in 2008 for Canada's best MGA, alongside Mississauga-based IDC Financial Inc.[16][17]

Sponsorships

World Financial Group provides financial support for the following athletes, teams and events:

  • In NASCAR, the Roush Fenway Racing and Carl Edwards's ride on the #60 Ford in the Busch Series. Previously, WFG had sponsored Roush Racing on Edwards' #99 Ford in the NEXTEL Cup Series and the #50 Ford in the Craftsman Truck Series.[18]
  • In 2007, WFG signed a two-year sponsorship agreement with Fox Sports Network and the Pacific-10 Conference (Pac-10).[19]
  • On October 3, 2007, WFG agreed to a three-year sponsorship of USA Luge.[20]
  • In 2008, World Financial Group sponsored Canadian professional golfer Brad Fritsch.[21][22]
  • In November 2008, World Financial Group announced its sponsorship of the Nanaimo Clippers for the 2008-2009 season. Now known as the World Financial Group Nanaimo Clippers, a Tier II Junior "A" ice hockey team from Nanaimo, British Columbia, Canada.[23]

Public speculation and lawsuits

WFG's stated mission goal is to "serve the financial needs of individuals and families typically overlooked by the financial services industry".[24] It is yet unclear how successfully the company has managed to distance itself from its more controversial US based predecessor WMA, associated with fraud, misrepresentation and false statements, and the subject of class action lawsuits, and NASD disciplinary action.[25][26] In preparation for Aegon's acquisition in 2001, "World Marketing Alliance 'ramped up' compliance before the acquisition".[27] As reported in the same Bloomberg article, Aegon's Chief Executive Officer Alexander Wynaendts said on Bloomberg TV that "When we took the company over, we put in place very strict regulatory and compliance procedures, Of course, when you have such large numbers of people out there in the field, it is quite an effort. We feel comfortable that we now have the regulatory issues under control."[27]

A 2004 NASD disciplinary action report summarized disciplinary actions against WGS. According to the report, WGS "submitted a Letter of Acceptance, Waiver, and Consent in which the firm was censured and fined $15,000. Without admitting or denying the allegations, the firm consented to the described sanctions and to the entry of findings that the firm permitted representatives to act in registered capacities while their registrations were inactive due to their failure to satisfy the Regulatory Element of NASD's Continuing Education Requirements. NASD also found that the firm failed to establish and maintain a supervisory system reasonably designed to assure compliance with the Regulatory Element of the Continuing Education Requirement by its registered representatives."[28]

In December 2006, World Group Securities and one of its brokers were fined $150,000 by Missouri's commissioner of securities for selling unsuitable products to elderly people.[29][30][31] Other cases of private arbitration "where variable annuities were allegedly sold to people too old to realize any benefit before they died" were also reported.[27]

In April 2007, World Group Securities was fined $50,000 for failing to supervise its representatives in the State of Utah, who were misrepresenting their credentials and services rendered during free lunch seminars targeting seniors.[29][32][33]

In April 2010, World Group Securities was fined in excess of $850,000 as the result of the unauthorized sale of private securities in the State of Arizona.[34]

In November 2010, the U.S Securities and Exchange Commission (SEC) ordered World Group Securities to pay, among other things, a civil monetary penalty in the amount of $200,000 for the fraudulent selling of unsuitable securities in the State of California, which were funded using home equity, derived from the refinance of the customers' homes into subprime mortgages.[35][36][37][38] Eccleston Law announced publicly on November 29, 2010, that it has expanded the investigation to include all branch offices nationwide.[39]

References

  1. ^ Aegon in Missouri Provokes Regulators Finding Sales Deceptions Bloomberg : May 28, 2008
  2. ^ http://www.sec.gov/Archives/edgar/data/769218/000092838503000979/d20f.htm#tx305_4
  3. ^ "2005 Annual Report". AEGON Review of Operations: Americas. Retrieved February 2, 2007.
  4. ^ a b c d http://www.huberthumphrey.com/flash/timeline.swf
  5. ^ http://www.cc.state.az.us/divisions/securities/news_releases/1998/nov25-98.pdf
  6. ^ http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20010305/SUB/103050717/-1/INIssueAlert04
  7. ^ http://world-financial-group.wfhdirectory.com/info/world-financial-group/
  8. ^ http://www.npros.com/dir/worldmarketingalliance/
  9. ^ http://www.iht.com/articles/2008/05/28/business/regs.php
  10. ^ [1]
  11. ^ [2]
  12. ^ "World Financial Group, Inc. Launches "Navigator System"". Business Wire. March 5, 2008.
  13. ^ Mutual Funds Dealers Association of Canada
  14. ^ "August 2006 Investment Executive".
  15. ^ "August 2007 Investment Executive".
  16. ^ "MGAs Deliver Big Time In Their Ongoing Training".
  17. ^ "MGAs Earn Accolades From Their Advisors".
  18. ^ "Roush Fenway Racing Corporate Sponsors".
  19. ^ "Pac-10 Corporate Partners".
  20. ^ "USA Luge Corporate Sponsors".
  21. ^ "Fritsch Takes Timeout for Open".
  22. ^ "World Financial Group Sponsorships".
  23. ^ "World Financial Group Named Title Sponsor for Nanaimo Clippers Junior Hockey Club".
  24. ^ "World Financial Group".
  25. ^ "Business Wire press release". Business Wire. October 22, 2001.
  26. ^ "NASD press release".
  27. ^ a b c "Bloomberg Article".
  28. ^ http://www.finra.org/web/groups/industry/@ip/@enf/@da/documents/disciplinaryactions/p012791.pdf
  29. ^ a b http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8N_74GdteOg
  30. ^ http://www.iht.com/articles/2008/05/28/business/regs.php
  31. ^ http://www.sos.mo.gov/securities/orders/AP-06-48.asp
  32. ^ http://www.securities.state.ut.us/press/worldgroup.pdf
  33. ^ http://google.com/custom?q=cache:vj66tFxgiAcJ:www.securities.utah.gov/dockets/06008002.pdf+world+financial+group&cd=4&hl=en&ct=clnk&client=google-coop-np
  34. ^ http://images.edocket.azcc.gov/docketpdf/0000110449.pdf
  35. ^ http://www.sec.gov/litigation/litreleases/2008/lr20768.htm
  36. ^ http://www.sec.gov/litigation/complaints/2008/comp20768.pdf
  37. ^ http://www.sec.gov/news/digest/2010/dig112210.htm
  38. ^ http://www.sec.gov/litigation/admin/2010/34-63354.pdf
  39. ^ http://financialcounsel.typepad.com/financialcounsel/2010/11/eccleston-law-launches-investigation-of-world-group-securities-.html
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