MORRISON APPLAUDS BILL AUTHORS, COMMITTEE MEMBERS, INSURANCE INDUSTRY FOR PROTECTING MONTANA’S MILITARY
Bill Approved To Give Troops Added Protection Against Scams
Montana State Auditor John Morrison announced today that Montana’s military enlistees will receive additional protection from insurance scams and financial fraud thanks to the approval of the Montana Military Personnel Financial Services Protection Act (HB 764) by the Montana legislature. The legislation addresses a growing problem with scams that target military families and personnel.
“I applaud the chief authors of this bill as well as committee chairs Representative Scott Mendenhall and Senator Vicki Cocchiarella for their leadership and action on this very important measure,” said Morrison. “This legislation targets those who prey upon Montana’s men and women in uniform and provides consumer protections that benefit the soldiers and their families – it protects those who protect us."
The Military Personnel Financial Services Protection Act (S. 418) was passed at the federal level and signed into law last fall by President Bush. Since insurance is regulated at the state level, the act directs individual states to work with the Secretary of Defense to implement the new law. The chief authors of the Montana measure were Representatives Mike Milburn (HD19), Elsie Arntzen (HD53), Scott Boggio (HD 59), Ernie Dutton (HD 56), Ralph Heinert (HD 1), Llew Jones (HD 27), Harry Klock (HD 83), Scott Mendenhall (HD 77) and Wayne Stahl (HD 35).
“When our soldiers are serving our country, they should not have to worry about unscrupulous representatives deceiving them into insurance or investment schemes that will harm them financially,” said Morrison. “Some of these dishonest agents have falsely claimed that the federal government endorsed their products in order to pressure service members into purchasing unsuitable policies or plans with high interest rates. This legislation will stop that practice.”
Earlier this session, the measure passed the Montana House Business and Labor Committee as well as the Senate Business, Labor and Economic Affairs Committee. The measure overwhelmingly passed on third reading on both the House and Senate floors and was signed by House Speaker Scott Sales and Senate President Mike Cooney last week. The bill was signed by Governor Brian Schweitzer today and is effective immediately.
The measure grants the state insurance commissioner the authority to protect military personnel from insurance agents and investment advisors who push harmful financial services. The bill also bans certain products and requires strong disclosures regarding offers of securities and insurance to military personnel. “These bad actors will no longer be able to act as though their products are recommended, sanctioned, or encouraged by the federal government,” said Morrison. “They will now have to clearly disclose that they are not. Furthermore, the agents wishing to sell insurance products must disclose the types of subsidized insurance available from the federal government, including the amount of coverage and the costs to service members.”
The federal law directs the Department of Defense to maintain a list of individuals who have been banned from selling financial services products on military bases, and to share that list with Federal and State securities and insurance regulators. “This new federal/state system will help track rogue agents who go from base to base to sell unsuitable financial products,” Morrison said. “It will help folks separate the wheat from the chaff so they know they’re dealing with legitimate, properly registered products and agents.”
“The bottom line is we need to ensure that our military families’ finances are protected, plain and simple,” Morrison continued. “Servicemen, women, and their families have an enormous burden to bear and they shouldn’t have to worry about a salesman knocking on their door and selling them something that could empty their pockets. This legislation will give my office the tools it needs to crack down on these predators and scam artists. I commend key members of the Montana House and Senate as well as key members of the insurance lobby for doing the right thing and working to pass this measure.”