Entrepreneurs Claim Defamation in SEC’s Federal Employee Benefit Counselors Case (FEBC)

ATLANTA--(BUSINESS WIRE)-- On July 31^st, the SEC filed a civil case against Federal Employee Benefit Counselors (FEBC), its founders Christopher Laws and Jonathan Cooke, and two affiliates.

FEBC provides benefits counseling and retirement planning to federal employees across the country. The company employs a staff of highly trained benefit counselors to provide guidance on the federal pension system, group life insurance, and its licensed affiliates provide retirement income planning.

FEBC and its affiliates are being accused of creating a scheme designed to defraud federal employees by recommending the transfer of their TSP funds to a variable annuity. In its July 31^st press release , the SEC stated: “The complaint alleges that the brokers misled investors concerning significant details about the recommended variable annuity investment, including the associated fees and guaranteed investment returns.” FEBC’s President, Christopher Laws, responded to the complaint, stating: “We believed all required and important information was disclosed to investors in the prospectuses, disclosure documents, and during the web-based presentations.”

The SEC further stated that, “The brokers allegedly fostered the misleading impression that they were in some way affiliated with or approved by the federal government. In some instances, investors were led to believe that their funds would be invested in a product that was offered, vetted, or specifically selected by the TSP.” Laws responded by stating: “We have not seen any evidence demonstrating FEBC represented itself as part of the federal government. In fact, FEBC founders specifically instructed employees and affiliates to disclose FEBC is a private organization.”

The SEC’s press release implied FEBC only recommended variable annuities and targeted elderly employees. Laws stated: “The SEC points to the 200 employees who purchased variable annuities, but fails to mentioned the hundreds of other employees who were advised to remain in the TSP or move to a non-variable annuity IRA account. Every recommendation of FEBC or its affiliates is based on the financial objectives of each particular customer. The SEC’s accusations rest on the false premises that every federal employee wants the least expensive investment platform and there is no value in the income riders available within variable annuity contracts. Ironically, variable annuities are registered products approved by the SEC for use in retirement planning.”

FEBC strongly suspects the SEC’s motive is to use this case to publicly discourage others in the financial industry from transferring funds away from the TSP while also promoting the new anti-commission legislation from the Department of Labor. “The federal government has been borrowing from the TSP’s G Fund over the last twenty years. The promotion of alternative income and investment options is a threat to this borrowing ability.”-Laws

On Friday, August 4^th, FEBC’s attorneys contacted the media and demanded retractions of articles that drastically mis-reported the SEC’s complaint.

FEBC plans to vigorously defend itself against the lawsuit filed by the SEC. FEBC has retained Steve Councill, a former Branch Chief in the SEC’s Enforcement Division in Atlanta as their legal counsel. Counsel for FEBC commented, “My clients are very anxious for people to hear their story and understand the facts of this case. They are particularly frustrated that the SEC has not separated them from the brokers that actually dealt with customers. The SEC’s entire case hinges on failure to make appropriate disclosures, and the brokers, not the owners of FEBC, were responsible for making those disclosures. Although they are very disappointed in the government for bring these false charges, my clients have faith in the justice system and are confident they will prevail once the facts are presented. They are looking forward to their day in court.”

View source version on businesswire.com: http://www.businesswire.com/news/home/20170809005265/en/

Federal Employee Benefit Counselors (FEBC)

Christopher Laws, 404-806-9237

President

[email protected]

http://www.myfebc.com/

Source: Federal Employee Benefit Counselors