Cease-and-desist order issued on Maumelle man.
The order from Securities Commissioner A. Heath Abshure said Lilly and Covenant were acting as unregistered investment advisers and that Lilly was improperly using various professional designations to imply that he possessed those specialized qualifications.
Lilly is licensed as an insurance agent with the Arkansas Insurance Department, but he is not registered with the Securities Department either as an investment adviser or an agent of an investment adviser.
Lilly is the organizer and manager of Covenant Senior Advisors and also does business as First Fidelity Financial Group of Maumelle.
The order cited two incidents in which Lilly advised elderly clients to roll over investments in 401(k) accounts into equity-indexed annuities with a 10-year maturity date.
"Recommendations to sell securities comprise advice concerning securities every bit as much as recommendations to buy securities," said Theodore Holder, assistant commissioner. "When those recommendations are made professionally, the person making the recommendations must be registered as an investment adviser. Only then can the investing public have some confidence in the soundness of such recommendations."
On May 23, a cease-and-desist order was entered against Lilly and First Fidelity along with two independent agents, D. Larry Puckett of Maumelle and Joe A. Richards of Greenbrier, over the sale of certificates of deposit.
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|Title Annotation:||BANKING & FINANCE|
|Date:||Jul 7, 2008|
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