Questions for Peter Dzoghi re. One-Star Review of C. Thomas Thames

Here are a few questions that Tom Thames has asked Peter Dzoghi and that all readers might want to consider.
 
1. Peter, in your one-star review you claim that you were young and inexperienced when you bought and then exchanged variable annuities. Weren't you about 27 years old in 1992? Didn't you have a college education? Weren't you running some sort of business at the time? Weren't you living on your own in a large city? Weren't you the owner of substantial investment assets? I don't buy your suggestion that you were too young to understand what you were doing. And if I had thought you were, I wouldn't have done business with you. I believe you were very capable of understanding what you were doing. And I believe you were well informed about my reasons for recommending the original variable annuities, and my reasons for recommending that you exchange some of them. And you certainly were informed by me, and by the prospectuses you received, that surrender charges would apply if you surrendered the annuities before they had been in force a specified number of years (probably 10 years, or less). Think about it. Your brother referred me to you, and I knew and often saw the attorneys who had represented your family for many years. Do you really think I was so desperate to sell a few variable annuities that I would try to deceive you and all of them? I was about 54 years old at the time and not even thinking about retirement, but at that time I would have been thinking that you would be a client for many years, until I did retire. I think that about all my clients. I would have had to be pretty dumb to think that I could deceive you for all that time, and I have never been that dumb Peter. I may have just opened the door for a snide remark, but I don't think either of us will gain much by getting into a debate over whose actions were dumb and dumber. I'm still shaking my head about your comment that no one should be expected to read a prospectus. I felt that way about a lot of textbooks when I was in high school, but I knew they were there for a reason.

2. I am very sure that for each exchange, the company that issued the old annuity would have sent you a closing statement explaining all charges that had been applied and showing you exactly how much had been transferred to the new company. And of course, the new company would have issued a contract that showed exactly how much was received. Are you really asking anyone to believe that you did not notice that you were paying surrender charges not only on the first exchange, but also on the second one, and every exchange after that? I know I have said this many times, but you had several opportunities to file a complaint with the insurance companies and if you had acted in time, you may have been able to get most or all your money back. In fact, you have said you and I had a falling out about surrender charges, and even though I don't recall that, I have to wonder why you didn't do something then. Why would anyone who believes they have a legitimate complaint wait until long after the statute of limitations expired to file an official complaint? That makes no sense Peter. 
 
3.  Peter, why do you still refuse to give me the names of the companies and the contract numbers for all the annuities that were involved? It certainly appears that you don't want anyone who reads your accusations to know all the facts. I don't know if the insurance company records will validate my claims, or yours, and since it has been over 30 years, they may not even be as complete as I think they are. But it's the only real evidence we have. There is no doubt that you paid substantial surrender charges but how significant were they compared to the total amounts you had invested? And did the newer annuities perform well enough to cover the surrender charges and still make a profit? How would the replaced annuities have performed if you had not exchanged them? Those are relevant questions that I can't answer without information from both companies that were involved. And if you had filed formal complaints when you had the chance, all that evidence would have already been considered. 
 
Peter, you can shrug all that off and say that some other adviser would say that there is simply no justification for ever recommending variable annuities, or exchanging them and paying surrender charges, but if they are willing to make that judgement without all the facts, reasonable people should question their credibility. I certainly would. And frankly, I doubt that any credible adviser would be willing to support either one of us without knowing all the facts. To do so would be very unprofessional. I know something about the advisors you have referred to in your review and while I believe they have a right to their opinion, there are many equally credible advisers and reputable financial institutions that recommend annuities. Today some companies are even issuing no-commission annuities that fee-only investment advisers are recommending. There is a time and place for annuities Peter, and I believe most professional advisers would agree with that, even if they don't personally recommend or sell them. 

NOTE TO READERS:  My advice to all readers is do not rely on Peter Dzoghi's comments about annuities. Peter is clearly biased, and so am I, so go on Google and do a lot of reading about the pros and cons of annuities. Keep an open mind and decide for yourself if certain types of annuities may provide what you need. Doing research on Google is just a start, I also recommend working with a qualified financial professional who is trained and experienced in both insurance and investment products. 

You might also want to take a look at the brief discussion of annuities on the Retirement Planning page of my website www.ctthames.com.  And here are three links to sites where you can read about fixed and variable annuities from what I think almost everyone would agree are credible sources. National Association of Insurance Commissioners (NAIC) Guide to Fixed Annuities - click HERE.  Securities and Exchange Commission (SEC) Guide to Variable Annuities- click HERE.  FINRA guide to annuities - click HERE.  Article "Ken Fisher Can't Have it All" by Michael Finke, Professor at The American College and leader of the Wealth Management Certified Professional designation program - click HERE.  These links are provided for educational purposes. The NAIC, SEC, FINRA, and Professor Michael Finke are not involved with the One-Star Review by Peter Dzoghi, or with my Response.

Although I have provided links to information about variable annuities, I no longer recommend or sell them. The only annuities I sell now are fixed and fixed indexed annuities and they are not considered investment products. Nor are they designed to compete with investment products. They don't have the growth potential that variable annuities and other investments have, but they don't have the risk of stock market losses either. Fixed annuities were designed for money that people want to keep safe. They aren't suitable for everyone, but for some situations, some form of fixed annuity may be the best solution. In my opinion, no financial adviser should refuse to consider them as one of the options for clients who don't want to take investment risks. Even if an adviser isn't licensed to sell annuities, if they realize that a fixed annuity would be appropriate for a client, they should recommend that the client contact a licensed agent. Any adviser who is acting as a fiduciary has an obligation to refer clients to other professionals when that is in the client's best interest. 

The internet is a great tool, but it can also be a dangerous place. If you have already made up your mind and are just looking for someone who will agree with you, you can surely find them on the internet. No matter how absurd or idiotic an idea one might have, they can find someone to support it on the internet. And many of those supporters will be using aliases and don't want to be held accountable for anything they say. Look for information from sources who provide their name, background information, and affiliations. 
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And it's worth remembering that every financial adviser who earns fees or commissions has a potential conflict of interest and has something to gain if they can convince you to take their advice. Whether it's your financial adviser, your dentist, or your auto mechanic, if they recommend something that they could receive compensation for, or that will help them in some way, they have a conflict of interest, and their customers might wisely wonder if that influenced their recommendation. It's nearly impossible to be in business without having a conflict of interest, and there is nothing immoral or illegal about it...but it's something everyone should consider. In some industries, such as the investment securities business, potential conflicts of interest (such as the ability to earn commissions) must be disclosed. That is one of the purposes of the prospectus that all variable annuity investors receive, and that Peter has said no one should be expected to read. 

Peter has a significant conflict of interest too. He may not be earning any fees or commissions, but he has something to gain. By convincing you that all annuities are bad, he is accomplishing his goal of discrediting products that I recommend. And no matter what Peter says, I believe that is his primary objective.  

Tom Thames

C. Thomas Thames

​October 18, 2024


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





 
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