The discovery of an alleged scheme in Pennsylvania to sell fake annuities to seniors has lead Ohio regulators to warn consumers about similar action there.

Mary Jo Hudson

Ohio Department of Insurance Director Mary Jo Hudson issued a warning about the potential insurance scam where individuals claim they are affiliated with Des Moines, Iowa-based American Equity Insurance and use the company’s letterhead as part of the scheme.

The “agents” make it appear that they work for the company and then attempt to sell fictitious annuities to seniors, Hudson alleges. Based on cases in other states, Hudson said, seniors were instructed to make their checks payable either to the agent or the agency. In return, they were given a bogus annuity contract the agents had created.

Hudson cited a case in Pennsylvania where one agent allegedly wrote 17 contracts, scheming seniors out of $600,000, an example she said she hopes to avoid in Ohio.

A spokeswoman for the Pennsylvania Insurance Department told IFAwebnews.com, she did not have information on a pending investigation into the matter. State regulators typically will not discuss their investigations or pending cases prior to the filing of charges.

“While there have been no reports of any wrongdoing in Ohio, [the department] is issuing this alert in order to make seniors more vigilant to this type of illegal activity,” the consumer warning states.