‘Annuity King’ calls Ponzi scheme charges ‘a joke;’ Trial starts today in Tampa

The criminal trial of the Florida-based, self-styled "Annuity King," Phillip Roy Wasserman, charged with annuity fraud and running a Ponzi scheme, is set to start today in a Tampa, Fla. courtroom.

When it will end is the big unknown. Wasserman told InsuranceNewsNet that his defense team submitted a witness list of 104 names and they expect to call about 60 to testify.

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 complete innocence.

"We have absolute proof that the government misrepresented the numbers, but even if you take their numbers at face value, the case is a joke," he said via email.

The Wasserman trial is first up on the trial docket before Judge Charlene Edwards Honeywell. On March 6, Judge Edwards Honeywell denied Wasserman's motion to dismiss the indictment due to "government misconduct." Wasserman's attorneys have made several allegations about how the government conducted its investigations. Those related motions have all failed.

Ponzi scheme alleged

According to the final indictment, Wasserman, a former lawyer and licensed insurance agent, allegedly worked in tandem with Kenneth Murray 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."

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.

"Wasserman spent a significant amount of the victim-investors’ money to finance a lavish lifestyle that included luxury residences, high-end vehicles, jet skis, jewelry, entertainment, gambling, retail shopping, home improvements, personal insurance, and many other expenses, for his personal benefit and the benefit of his family members," the release said.

The superseding indictment also alleges that Wasserman took numerous steps to evade payment of more than $900,000 in taxes and filed false individual and corporate income tax returns. It also alleges that Rossman filed false income tax returns for himself and for victim-investors.

Wasserman said that an independent forensic audit concluded that he took just $1.5 million from the company over five years.

Rossman flips

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," court documents read.

"He has absolutely nothing he can say that can harm me," Wasserman said.

Wasserman has operated investment businesses in the Sarasota, Fla., area for years under various names, including Phillip Roy Financial Consultants and Phillip Roy Financial Services. He has held investment seminars about annuities and life insurance attended by thousands of Florida seniors, styling himself as "The Annuity King" in some advertising.

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.

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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.