LOS ANGELES (CN) – MetLife Insurance defrauded investors, including elderly people, by guaranteeing them 9 to 12 to percent annual returns on real estate investments, a class action claims in Superior Court. Also sued were New England Life Insurance, two of its wholly owned subsidiaries, and Tony Russon and Russon Financial Services, of Woodland, Calif., who was, or held himself out as, a MetLife regional manager.
Named plaintiffs Lawrence Cantor and Larry Stilley say they invested $1.95 million with “an authorized ‘agent’ with Met Life,” who used it to enter contracts with nonparty Diversified Lending Group (DLG). The “funds invested in DLG contracts were ultimately not repaid,” the men say.
According to the complaint, the SEC sued DLG and Bruce Friedman in Federal Court, accusing them of selling $216 million in securities to investors, many of them elderly. The SEC says the defendants diverted “a substantial amount” of the money to Friedman’s businesses unrelated to real estate or mortgage lending, and that Friedman snitched “a minimum of $17 million to support his lavish lifestyle, including purchases of a luxury home, cars, vacations, jewelry and designer clothing and accessories,” and that he grabbed $275,000 “for the personal use of his girlfriend.”
Friedman consented to judgment, then fled to France, where he was arrested and is awaiting extradition, according to the complaint.
Cantor claims he invested $1.35 million with MetLife, believing its claim that he would get 12 percent annual returns for 5 years.
Stilley says he invested $597,768.
They seek class damages for negligent misrepresentation, breach of fiduciary duty, unfair competition and financial elder abuse.
Their lead counsel is Thomas Foley Jr. with Foley, Bezek, Behle & Curtis.