Look out for free lunches and ‘senior specialists’


It has been a bad scene for years, and it’s getting worse. We are talking about the “educational seminars” for seniors that dangle a free lunch or dinner as bait. Direct-mail solicitations and advertisements tell us we must attend if we want to safeguard the life savings we’ve worked so hard and so long for.

In reality, that free meal may be the most expensive one you’ll ever eat. Before you get to the dessert, you will have endured a soft but clever sales pitch to buy an investment that may be totally unsuitable for you but will generate big commissions to the seller.

If you don’t fall for the pitch then, the presenter is counting you will at a follow-up “free consultation,” when you will be subjected to a truly hard sale.

We know because we’ve attended more than a dozen of these seminars, even signing up for the follow-up consultation just to see what goes on. In most cases, we saw presenters preying on seniors’ fears and lack of financial sophistication.

Typically, we were told that unless we did as the presenter recommended, we risked losing our life savings. Fear, not greed, is the usual motivator at these seminars. Questions or concerns were casually dismissed, and we were made to feel silly or ignorant for raising them.

At our follow-up “consultations,” the salespersons kept pushing us to buy their product, and in one instance even berated us for not doing so.

Sadly, our experience is hardly unique. Patricia Struck, president of the North American Securities Administrators Association, told a Senate panel recently that regulators are receiving an increasing number of complaints from older Americans enticed into attending seminars by “senior specialists,” commonly through the offer of a free meal. The North American Securities Administrators Association is an organization of state securities regulators.

“Individuals may call themselves senior specialists to create a false level of comfort among seniors by implying a certain level of training on issues important to the elderly,” said Struck, who is also the Wisconsin Securities Division administrator. But the training they receive “is often nothing more than marketing and selling techniques targeting the elderly.”

These “senior specialists,” regardless of your circumstances, will often recommend you sell whatever investments you own and put the money into what they are selling, commonly a variable or equity-indexed annuity.

While such annuities are legitimate investments and can be appropriate for some people, they usually come with high costs and stiff surrender penalties that make them unsuitable for many seniors, Struck said. The way annuities and other products for seniors are being marketed has raised so many concerns that North American Securities Administrators Association devoted a big chunk of its annual public policy conference to the topic on May 9.

Under state securities laws, recommendations to buy annuities and similar products may be viewed as providing investment advice for compensation. In such cases, the “senior specialist” would be improperly offering investment advice as an unregistered investment adviser. Just in the past year, state regulators opened 26 cases against “senior specialists” in the eastern half of the United States alone, most of them involving securities recommendations by individuals who are not properly licensed, Struck said.

“While our cases of senior investment fraud may not make national headlines, they are devastating in their impact to the victims and their families,” she told the senators. “What would you do if your mother or father turned over their retirement nest egg to a smooth-talking ‘senior specialist’ who promoted unsuitable investments?”

No one knows exactly how many older Americans are victims of investment fraud because they often don’t want others to know they have lost money or made an unsound investment. In addition, they don’t know how or where to complain. Struck’s plea, and ours: Before deciding on any investment, particularly one pitched at an investment seminar, check with your state securities regulator. You can find a list on the North American Securities Administrators Association Web site at

Humberto and Georgina Cruz are a husband-and-wife writing team who work together in this column. Send questions and comments to or