BD Charged With Fleecing Seniors With Unsuitable Products, High-Pressure Contests

In Massachusetts, the broker-dealer is working with Eastern Bank of Boston, Mutual Bank of Brockton, East Boston Savings Bank, Edgartown National Bank, The Cooperative Bank of Roslindale, and Homefield Credit Union of North Grafton.

From early-2014 to mid-2016, the top 10 IPI representatives in these banks received over 2,200 referrals, about 45% of which involved clients 65 and up. Eight of the 10 are employees of Eastern Bank.

Over the past three years or so, IPI organized "at least five aggressive sales contest all of which ran counter to the firm's own policies and procedures," the regulators say. Plus, they found that the broker-dealer "failed to supervise its representatives by promoting prohibited sales contests," which resulted in sales of "unsuitable products" – such as market-linked CDs and annuities – by "at least two IPI agents working out of Eastern Bank."

Massachusetts regulators say their investigation of the two agents' sales practices is ongoing.

"While IPI and their bank partners profit from their networking arrangements," the complaint says, "the pervasive sales culture emphasizing and rewarding the volume of production at the expense of compliance with policies and procedures, suitability, and oversight means that certain senior citizen bank customers have been harmed."