A pair of rulings go against the ‘Annuity King’ in week one of fraud trial

The judge ruled against the self-styled "Annuity King" is a pair of evidentiary rulings during the initial days of the high-profile fraud trial in Tampa, Fla.

As a result, Phillip Roy Wasserman will have to turn over text messages traded with bookkeeper Suzanne Linton and former business associate Kenneth Rossman. In an email response to InsuranceNewsNet, Wasserman downplayed the rulings, but declined to comment on the specifics.

"This case is entirely about me being targeted for all my activism on behalf of the life insurance and annuity industry," he responded.

Wasserman was initially indicted in June 2020, but the government filed a superseding indictment in November of that year. Prosecutors allege that Wasserman led a $6.3 million financial fraud. The three most serious charges – wire fraud, mail fraud and conspiracy to commit wire and mail fraud – all carry maximum sentences of 20 years.

Wasserman maintains his innocence and said he will take the stand and expects to testify "for several days." Judge Charlene Edwards Honeywell has said the fraud trial, which began with jury selection April 3, is expected to last six to eight weeks, according to court documents.

Fraud trial gets started

Government attorneys had called 17 witnesses through Friday, according to court documents. The judge's ruling on Rossman texts could bolster their case going forward.

According to the final indictment, Wasserman, a former lawyer and licensed insurance agent, allegedly worked in tandem with Rossman, a Florida certified public accountant and licensed insurance agent, to convince elderly investors to put their money into Wasserman’s new insurance venture, “FastLife.”

In doing so, the men made "false and fraudulent misrepresentations and concealed material information," said the U.S. Attorney's Office for the Middle District of Florida.

"Some victims were persuaded to liquidate traditional investments, such as annuities, and/or to borrow funds against existing life insurance policies to generate cash to invest in the venture," a news release reads. "These victims were not told about surrender fees and other costs associated with the liquidations, and Rossman prepared income tax returns for victim-investors in a manner designed to conceal negative personal tax consequences that resulted from the liquidations from both the victim-investors and the Internal Revenue Service."

Ponzi scheme alleged

Wasserman paid Rossman a percentage of the victim-investors’ money as compensation for his role in the conspiracy, prosecutors say. Wasserman also used the victim-investors’ funds to make payments both to earlier victim-investors in the FastLife venture and to victim-investors in his earlier hedge fund and real estate fund ventures, a classic Ponzi scheme.

In July 2021, Rossman accepted a plea deal. According to court documents, Rossman pleaded guilty to one count of  conspiracy to commit mail fraud and wire fraud, and one count of "aiding and assisting the preparation and filing of fraud and false tax returns." The two counts carry a maximum of eight years behind bars.

In exchange for the plea, Rossman "agrees to cooperate fully" with the government "in the investigation and prosecution of other persons, and to testify" during the fraud trial, court documents read.

InsuranceNewsNet Senior Editor John Hilton covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.

© Entire contents copyright 2023 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reprinted without the expressed written consent from InsuranceNewsNet.com.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.