On June 25, 2008, the Securities and Exchange Commission (SEC) issued a rule proposal to exclude equity-indexed annuities from exemption from Federal securities laws. By requiring registration of equity-indexed annuities under Federal securities laws, the rule gives investors of equity-indexed annuities the same protection as it gives to investors of other securities similar to equity-indexed annuities.
In this paper, Dr. Craig McCann explains how equity-indexed annuities are complex contracts whose true risks and costs are often obscured and how the lack of SEC oversight and regulation have resulted in 'unscrupulous' sales practices of equity-indexed annuities issuers. Dr McCann is in support of the SEC rule proposal.
Other papers can be found at our dedicated website.
