Ever­est Wealth chal­lenges in­sur­ance reg­u­la­tor’s or­der

Hear­ing to de­ter­mine whether penal­ties against firm will be en­forced

Baltimore Sun - - BUSINESS MARYLAND - By Sarah Gantz sarah.gantz@balt­sun.com twit­ter.com/sarah­gantz

Ever­est Wealth Man­age­ment Inc., the Tow­son firm known for its “Money Guys” in­fomer­cials, is chal­leng­ing an or­der by the Mary­land In­sur­ance Ad­min­is­tra­tion to strip owner Philip Rousseaux and oth­ers at the firm of their in­vest­ment ad­viser li­censes.

The or­der, is­sued last De­cem­ber, fol­lowed an in­ves­ti­ga­tion by the in­sur­ance ad­min­is­tra­tion that found Ever­est had used mis­lead­ing in­for­ma­tion in its in­fomer­cials and blurred the line be­tween the in­sur­ance com­pany Ever­est Wealth Man­age­ment and its re­lated ad­vi­sory ser­vices. The or­der also calls for Rousseaux and Ever­est to pay $62,400 in fines.

Ever­est de­nied wrong­do­ing and chal­lenged the or­der, launch­ing what could be a week­long ad­min­is­tra­tive hear­ing to de­ter­mine whether the penal­ties against Ever­est will be en­forced.

If the hear­ing of­fi­cer, Bob Mor­row, an as­so­ci­ate com­mis­sioner for hear­ings at the in­sur­ance ad­min­is­tra­tion, up­holds the or­der, Ever­est has said it will ap­peal the de­ci­sion to the Cir­cuit Court.

Dur­ing the pro­ceed­ings, which started this week, Ever­est is ex­pected to make a case that the al­le­ga­tions and penal­ties levied against the com­pany are un­fairly harsh and part of a broader ef­fort to by Mary­land At­tor­ney Gen­eral Brian Frosh to take down Ever­est and Rousseaux. Ever­est faces sep­a­rate but re­lated ac­tions from the se­cu­ri­ties di­vi­sion of the at­tor­ney gen­eral’s of­fice.

“Noth­ing about this case makes the in­sur­ance mar­ket­place bet­ter for cus­tomers,” said Alex J. Brown, an at­tor­ney with Shapiro Sher Guinot & San­dler who is rep­re­sent­ing Ever­est, dur­ing the hear­ing. “I think this case has turned into a bat­tle of wills.”

In open­ing state­ments Tues­day, Brandy Gray, the as­sis­tant at­tor­ney gen­eral for the Mary­land In­sur­ance Ad­min­is­tra­tion, de­fended the agency’s find­ings and ac­tions against the com­pany as straight­for­ward ev­i­dence of wrong­do­ing by Ever­est.

In June 2015, Frosh ac­cused the com­pany of fraud­u­lently mis­rep­re­sent­ing the risks of its in­vest­ment strat­egy, and said he wanted to shut down the busi­ness and per­ma­nently ban Rousseaux from of­fer­ing in­vest­ment ser­vices in the state.

Ever­est fired back with a law­suit against Frosh, but the case was dis­missed.

Ear­lier this year, an ad­min­is­tra­tive judge rec­om­mended a $250,000 fine for Rousseaux, re­vok­ing his li­cense and per­ma­nently bar­ring Ever­est Wealth Man­age­ment from op­er­at­ing as an ad­vi­sory com­pany.

Ever­est is await­ing a fi­nal de­ci­sion from As­sis­tant At­tor­ney Gen­eral Lucy Card­well. If not in the com­pany’s fa­vor, Ever­est will ap­peal the de­ci­sion to the Cir­cuit Court, Rousseaux said.

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