An investment firm in Lincoln, Neb., and one of its brokers in New Jersey were fined for inducing customers to take on addition mortgage and home equity debt so they could buy variable universal life insurance policies, according to FINRA.

Ameritas Investment Corp. was fined $100,000 for failing to adequately supervise broker Nancy Ziering, who was based in New Jersey, FINRA records show. The fine also was for Ameritas’ advertising violations related to Ziering’s plans, which FINRA found were misleading and that her recommendations to customers to purchase the VUL policies were unsuitable.

The policies were pitched to customers as mechanisms for funding college expenses and retirement, FINRA said.

Ziering was fined $60,000 and suspended for six months, ending July 5, according to recently released FINRA records.

FINRA investigators say that between October 2003 and December 2005, Ziering used misleading financial plans with more than 220 customers who she recruited through her separate college-planning business, Madison Financial Aid Consultants. Through the company, she gave college-planning seminars at schools and other locations for parents whose children were approaching college age. After her presentations, FINRA said, she would offer to meet with parents to discuss funding college and other financial matters.

FINRA said the financial plans she prepared were extremely complicated and confusing and, to be successful, required customers to adhere strictly to all aspects of the detailed plan for 20 years. Although the plans were marketed as a way to demonstrate how customers could save for college and retirement, in nearly every instance, FINRA said, they recommended that the customer purchase a VUL policy issued by an affiliate of Ameritas, using money obtained from refinancing a mortgage or taking out a home-equity loan.

More than 90 of the customers who received the financial plans purchased at least one VUL from Ameritas, FINRA said.

Ameritas became aware of Ziering’s use of the misleading plans, but failed to take sufficient action to stop her, FINRA said.

In six cases, FINRA said, Ziering’s recommendations to buy VULs were unsuitable. In one case, the customer provided Ziering with information showing that she and her husband were spending more on expenses than they received in income, including nearly $80,000 in credit card and other debt, first and second mortgages, car loans and anticipated college expenses. Ziering recommended that the customers buy a VUL policy and assume two large annual premium payments, FINRA said.

In another case, where the customer had significant assets to pay for college and also owned life insurance policies, Ziering recommended the same plan, including refinancing a home mortgage to purchase a VUL, FINRA said.

Ameritas, prior to FINRA’s actions, rescinded the VUL policies purchases by six customers who received the bad recommendations. The premiums also were refunded.

Neither Ziering nor Ameritas either admitted or denied the allegations, FINRA said.