Court Vacates SEC’s Rule 151A
July 12, 2010 by Sheryl J. Moore
Good evening, everyone! Great news this evening on the 151A litigation front- the court has vacated the SEC’s rule 151A. Here is language from the court’s order:
“Having determined that the SEC’s S. 2(b) analysis is lacking, we grant the petitions [assertion that] the SEC failed properly to consider the effect of the rule upon efficiency, competition, and capital formation… We therefore order that Rule 151A be vacated.”
So, what does this mean to all of us?
This means that the court effectively settled 151A. As far as the judicial branch is concerned, there is not sufficient evidence to suggest that indexed annuities should be regulated as securities.
Is the securities status of indexed annuities settled for good?
No. Remember- the Securities and Exchange Commission first questioned the securities status of indexed annuities in 1997. They did so again in June of 2008 with their proposed rule 151A. If we want to ensure that indexed annuities will be regulated as fixed insurance product indefinitely, we need to continue our current legislative strategy.
When will the securities status of indexed annuities be settled for good?
Thanks for all of your hard work, everyone. I appreciate all of the grassroots efforts, the lobbying, the regulatory and legislative work, as well as every other form of SKIN IN THE GAME! You are all to be commended and I am proud to be on your team!
I also want to send out a special “thank you” to the companies that pursued the SEC in litigation. I am proud to work with every insurance company offering indexed insurance products, but these companies have helped to ensure that the products I feel so passionate about will continue to be offered as they are today. THANK YOU! sjm