2 former Northwestern Mutual agents under investigation for how they sold life insurance

State officials in New Hampshire are investigating at least two former Northwestern Mutual insurance agents for how they sold and marketed life insurance to customers.

The investigation into the Milwaukee-based company has gone on since July 2021 and is being conducted by New Hampshire's Department of Insurance and the securities division of the New Hampshire Secretary of State. According to records obtained by the Journal Sentinel, the investigation involves at least two agents in a Northwestern Mutual affiliate office called the Christensen Financial Group, doing business as Northwestern Mutual Northern New England.

A spokeswoman with the New Hampshire Secretary of State confirmed the investigation but would not comment on details. When the investigation is complete, however, it will be posted to the New Hampshire's insurance department website.

A federal Securities and Exchange Commission document on one of the agents at the center of the probe sheds light on some issues. According to the document, the agent, who was based in Manchester, New Hampshire, is being investigated for marketing emails sent out, how the agent compensated staff and how the agent had consumers apply for various life insurance policies.

Another former Northwestern Mutual agent under investigation by New Hampshire resigned from the company for allegedly sending unapproved marketing emails to prospective clients, according to a disclosure from the Financial Industry Regulatory Authority, or FINRA, a nonprofit that works with the federal government to oversee life insurance and investment brokers.

Julia Fennelly, a spokeswoman for Northwestern Mutual, said she could not comment on the investigation but said the company takes regulatory compliance matters seriously.

She confirmed the agents involved are no longer with the company.

A former associate with the Northwestern Mutual affiliate office who was interviewed by New Hampshire authorities told the Journal Sentinel he witnessed problematic behavior there. The associate reached out to the newspaper about the New Hampshire investigation and shared documents.

"The allegations are concerning because, and I believe what the state is focused on is, some of these people circumvented the rules and regulations for personal gain at the expense of the integrity of the products they solicit and the clients they serve," said the former associate, who requested anonymity because he still works in the insurance industry.

"People are being misinformed and making poor purchasing decisions. They then unintentionally mishandle their policies and sometimes end up forfeiting hundreds of thousands of dollars to the company. Oftentimes the advisers who sold the policies are nowhere to be found once the hoodwink is exposed," he said.

Northwestern Mutual sells an assortment of insurance products, including life, disability and long-term care. It also offers financial planning and investments. It has more than 360 offices nationwide and 6,700 employees. It has hundreds of financial representatives who work as independent contractors but are trained by Northwestern Mutual and act as representatives of the company.

The Office of the Commissioner of Insurance in Wisconsin, which issues licenses and regulates the insurance industry in the state, would not comment on whether it was aware of or was also investigating any agents working with Northwestern Mutual.

But the agency said it encourages consumers to check out any insurance company or agent before agreeing to do business with them. Insurance is regulated by the states, and consumers can look up their agent's history and license information on their state's websites.

Trust between a financial adviser is especially important because of the lasting effects of financial and insurance decisions, said the former associate.

"If that trust is misplaced, consumers can fall into making poor decisions for themselves, which carry long-lasting ramifications, sometimes going unnoticed for decades and impacting their families for generations," he said.

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Contact Katelyn Ferral at [email protected] or 608-405-9777. Follow her on Twitter @katelynferral.

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