The Securities and Exchange Commission charged four former Atlanta-area brokers - Christopher S. Laws, Jonathan D. Cooke, Danny S. Hood, and Brandon P. Long - on Monday with fraud, for allegedly fooling federal employees into rolling over their federal Thrift Savings Plan or TSP retirement accounts into higher-fee, variable annuity products. According to the SEC, the Atlanta firm - Federal Employee Benefits Counselors -targeted federal employees nearing retirement that held significant amounts in the TSP. The SEC alleges the brokers misled investors about the associated fees and guaranteed investment returns in the recommended variable annuity investment and encouraged the employees to believe the firm was affiliated with or approved by the federal government. The brokers allegedly collectively earned approximately $1.7 million in commissions on sales of approximately 200 variable annuities with a total face value of approximately $40 million to federal employees, who rolled over funds from their TSP accounts to fund the investments. The SEC is seeking disgorgement of the alleged illegal gains plus interest and penalties and permanent injunctions. The SEC issued an investor alert to remind federal employees that the TSP will never request sensitive personal information directly and does not authorize third parties to provide counseling or investment-related services.
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