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MAINE BUREAU OF INSURANCE
34 SHS, Augusta, Maine 04333-0034

Tel. (207) 624-8475 Fax (207) 624-8599
TDD (207) 624-8563
For Immediate Release May 24, 2005
   

South Portland Insurance Producer Fined $5,000
Insurance License Suspended for 180 Days

Augusta, Maine: Superintendent of Insurance Alessandro A. Iuppa today announced disciplinary action against insurance producer Gary Russell Smith for violating Maine law. Until recently, Mr. Smith was the Branch Sales Manager for Bankers Life and Casualty Insurance Company’s office in South Portland, Maine. In his capacity as manager, Mr. Smith supervised several licensed producers appointed by Bankers Life.

Bureau staff investigated two distinct consumer complaints which involved inappropriate sales actions by several producers from the South Portland branch office. In one case, producers used an improper ownership designation on an annuity. The other complaint involved an elderly consumer who was inappropriately sold an annuity. Gary Russell Smith violated Maine law when he allowed the producers that he supervised to improperly sell and set up an annuity without fully disclosing and explaining to the buyers the effects and implications of the designated annuity ownership. Mr. Smith also violated Maine law in the other instance when his producers inappropriately sold an annuity to an elderly consumer. Although Mr. Smith had expressed concern to the producers that the transaction was not in the elderly consumer’s best interest, Mr. Smith allowed the transaction to take effect.

“The Bureau of Insurance takes its responsibility to protect Maine consumers very seriously. We will continue to take action against any producer or company that does not act in the best interests of consumers in the sale of insurance products, and we will hold the supervisors of such producers accountable as well,” stated Superintendent of Insurance Iuppa.

Gary Russell Smith’s license to sell insurance has been suspended for 180 days and a $5,000 fine has been assessed. Mr. Smith is also precluded from acting in a managerial or supervisory capacity in the insurance industry for 10 months following the reinstatement of his license. It is important to note that there are other Gary Smith’s who are licensed producers in Maine. This disciplinary action, however, refers to Gary Russell Smith.

Today’s action follows action announced last month by the Insurance Superintendent against Bankers Life & Casualty Company of Illinois, which was fined $400,000 for failing to provide adequate training and supervision for its appointed producers in the South Portland and Bangor branch sales offices. As part of that negotiated resolution, Bankers Life must provide restitution to Maine consumers who have been harmed by Bankers Life producers. The company will also invest $100,000 in organizations and initiatives that benefit Maine’s senior citizens. The settlement requires Bankers Life to implement an extensive corrective and preventative plan.

The Bureau of Insurance is part of the Department of Professional and Financial Regulation, which encourages sound ethical business practices through high quality, impartial and efficient regulation of insurers, financial institutions, creditors, investment providers, and numerous professions and occupations for the purpose of protecting the citizens of Maine. Consumers can reach the Bureau through its Web site at www.MaineInsuranceReg.org; by calling 800-300-5000 in state; or by writing to Bureau of Insurance, 34 State House Station, Augusta ME 04333.

Last Updated: May 24, 2011