NAFA Filed Amicus Curiae Brief, Pushed for Published Decision
WASHINGTON (Sept. 21, 2016) — After three years of agency and court litigation, the Illinois Appellate Court for the Fourth District has ruled that, under Illinois law, fixed indexed annuities are only to be regulated as insurance products and not as securities. This comes as a major victory for the fixed annuity industry as a whole, in addition to the more than 20,000 agents and advisors licensed to sell fixed annuities in the state.
The case began as an administrative action brought by the Illinois Secretary of State against Richard Van Dyke. The Secretary eventually ruled that fixed indexed annuity products should be regulated not only as insurance, as they had been for almost 50 years, but also as securities under the Illinois Securities Department. Miscategorizing the product in this way would have added another complex layer of regulation to indexed annuity sales and created an unworkable environment for agents and ultimately hindering consumer access to these valuable products. After this ruling by the Secretary of State (which was later affirmed by the Sangamon County Circuit Court), NAFA established a working group to address the matter. The Association then engaged the Chicago law firm of Quarles & Brady to assist in preparing an amicus brief in support of Van Dyke’s appeal, emphasizing how the Secretary of State’s ruling could devastate the industry in Illinois. NAFA’s brief also explained how the ruling had no support in any statute, rule or case law.
View the complete PDF HERE.