Tr?id=566623520170033&ev=PageView&noscript=1

Ä¢¹½´«Ã½

FINRA Sanctions Former Advisor for Unsuitable Variable Annuity Exchanges

Posted on June 17th, 2025 at 11:40 AM
FINRA Sanctions Former Advisor for Unsuitable Variable Annuity Exchanges

From the desk of James Eccleston at Ä¢¹½´«Ã½

The Financial Industry Regulatory Authority (FINRA) has fined and suspended former broker Thomas Vigil for making unsuitable variable annuity recommendations that resulted in customers paying higher fees.

According to a FINRA Acceptance, Waiver and Consent (AWC), from June 2019 to February 2020, Vigil recommended 10 unsuitable L-share variable annuity exchanges to nine customers and two unsuitable variable annuity purchases to two others. Those recommendations lacked a reasonable basis and led customers to incur increased costs.

As a result, FINRA imposed a 12-month suspension, a $10,000 fine, and ordered Vigil to pay $25,436 in restitution plus interest.

Variable annuities offer various contract features and optional riders. L-share annuities, in particular, carry higher fees in exchange for shorter surrender periods, making them potentially unsuitable when paired with long-term riders like a Guaranteed Minimum Withdrawal Benefit (GMWB) rider. According to ThinkAdvisor, GMWB riders typically require the customer to hold the annuity for at least five years without withdrawals to realize its full benefit.

In this case, Vigil recommended customers replace their existing annuities with L-share contracts carrying four-year surrender periods, combined with GMWB riders guaranteeing at least 10 years of 6 percent annual step-ups — a mismatch of product design and intended use.

Vigil failed to perform or document any suitability assessment for these transactions. He also neglected to conduct a comparative analysis of the costs, fees, and benefits between the surrendered and replacement annuities. Documentation falsely claimed the replacements would reduce fees, though they actually increased customer expenses by 50 basis points.

 

Ä¢¹½´«Ã½ LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, finra

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

If the regulators are after you, and are trying to make a case against you, and you are going to contest their allegations against you, make sure you have the best securities industry defense lawyers, Ä¢¹½´«Ã½ Firm. My case was spun into a combination of penalties including fines, cash settlements, CE courses and suspension. They were the best I have seen in action. When all was said and done, they had done their magic, my situation was negotiated and settled with a simple "letter of caution" and a case closed without action. It is the most important legal business decision you will ever make, make it Ä¢¹½´«Ã½.

Rick R.

LATEST NEWS AND ARTICLES

1786734880 Law
August 14, 2026
Cash Sweep Litigation Continues to Drive Legal Costs

Cash sweep litigation continues to increase legal costs for wealth management firms despite the Securities and Exchange Commission's (SEC) decision under the Trump administration to close pending investigations without imposing enforcement penalties, according to AdvisorHub.

1786636784 Law
August 13, 2026
FINRA Orders Centaurus Financial to Pay $1.1 Million Over Variable Annuity Supervision Failures

The Financial Industry Regulatory Authority (FINRA) has ordered Centaurus Financial Inc.

1786553985 Law
August 12, 2026
Proposed FINRA Enforcement Reforms Draw Mixed Reactions From Industry Participants

A new report recommending changes to the Financial Industry Regulatory Authority's (FINRA) enforcement program has generated mixed reactions from investor advocates, securities attorneys and industry professionals, according to ThinkAdvisor.