MILWAUKEE (CN) – Northwestern Mutual Life Insurance cheated annuity-holders of millions of dollars in dividends in a “long-running, sophisticated, and ongoing scheme,” a class action claims in Milwaukee County Court. Instead of paying true dividends, Northwestern doles out “earned on an account limited to some short-term bonds exclusively and secretly chosen by Northwestern,” the class claims.
“To initiate this scheme, Northwestern unilaterally and deceptively altered the basis on which it credited the accounts of Annuitants,” the complaint states. “Ignoring the Annuity contract’s plain requirement to credit the Annuitants’ accounts with a genuine share of the company’s divisible surplus as dividends, Northwestern instead has credited Annuitants with what it continues to call ‘dividends’ but in fact is merely the interest earned on an account limited to some short-term bonds exclusively and secretly chosen by Northwestern. Thus, instead of receiving the contracted-for investment in the growth and profitability of Northwestern, Annuitants have been unilaterally relegated to a much less valuable and more limited investment in some short-term bonds, all without the Annuitants’ consent or even notice.”
Plaintiffs’ lead counsel is Kersten & McKinnon of Mequon, Wisc., and Straus & Boies of Fairfax, Va.