LAKE COUNTY — The results of a California Department of Insurance investigation allege that local business owner Glenn A. Neasham acted illegally when he sold a $175,000 annuity to an 83-year-old woman in February 2008, according a CDI statement released Thursday.
“The claim against me is frivolous,” Neasham said in a statement Thursday. “I did absolutely nothing wrong. I improved her financial position dramatically. I did my job 100-percent ethically for my client, and the annuity was a great improvement from her previous financial situation, as well as it was a suitable investment.”
The Lake County District Attorney”s Office arrested Neasham Tuesday afternoon on one felony charge of theft from an elder or dependent adult exceeding $950.
Two special allegations accompany the felony charge, according to deputy district attorney Rachel Abelson, including that the theft exceeded $100,000. Neasham could face up to five years in prison, Abelson said.
Neasham, 50, lives in Hidden Valley Lake and operates two businesses in Lake County, including Neasham Financial, Insurance and Retirement Planning in Lakeport.
The CDI investigation found that the woman withdrew funds from a certificate of deposit (CD) to purchase the annuity, according to the CDI statement.
The statement stated that the CDI determined that the woman “lacked the mental capacity to enter into this contract, and that the terms and conditions of the annuity contract were not in her best financial interest.”
Mitchell Hauptman, Neasham”s criminal defense attorney, said the CDI accusation was “the most outrageous charge I”ve seen in 30 years.” Hauptman said after reviewing the investigation documents, he could find “no evidence at all of the incompetence” on the part of the woman.
“There is no evidence in any report that the elderly client suffered any financial loss or that Neasham took anything from her,” Hauptman later said in an e-mail statement.
Hauptman added in the statement that Neasham received “the typical commission” for the transaction and is not named “a beneficiary of any portion of the elderly client”s estate.”
Abelson said it would be “improper” for her to discuss specifics or theories about the Neasham case but did discuss generally issues associated with insurance agents selling annuities to senior citizens.
“In general there are a lot of scams/thefts that involve annuities and the elderly,” Abelson wrote in an e-mail statement.
Issues with such transactions include some elderly people having difficulties understanding “the true nature of the transaction,” according to Abelson, and that under the California Insurance Code, insurance agents and brokers have “a duty of honesty, good faith and fair dealing” with a client who is more than 64 years of age.
Abelson wrote in her statement, “When you couple those issues and those duties with a person who lacks mental capacity to enter into financial transactions you certainly can have elder abuse (theft).”
Contact Jeremy Walsh at jwalsh@record-bee.com or call him at 263-5636, ext. 37.
