Investigation Looks Into Life Insurance Policies Of Fallen Military

Many families of fallen military members may be the victims of fraud, which is why New York Attorney General Andrew Cuomo is calling for an investigation. According to CNN, Cuomo’s office released details of the new investigation saying they’re looking into “practices that appear to have denied grieving military families and others of millions in life-insurance cash.”

Officials say that some insurance companies are telling families of late military personnel that they’re putting life insurance policy money into an interest-bearing account. But what really happens, according to some officials, is that the insurance company is benefiting from most of the interested earned– some times taking as much as 4.8 percent while the families receive just .5 percent of the interest. Another issue Cuomo is raising is that the insurance money is being put in banks that are not insured by the Federal Deposit Insurance Corporation, or FDIC. “It is shocking and just plain wrong for these multi-national life insurance companies to pocket hundreds of millions in profits that really belong to those who have lost family members and have already suffered immensely,” Cuomo told CNN.

Officials say the accounts being targeted in the investigation include Prudential’s Alliance Account and MetLife’s Total Control Account. However, the attorney general’s office says they’re looking into the entire life insurance industry. According to CNN, Prudential’s Chairman and CEO John Stangfield released a written statement saying, “It is important that the beneficiaries of our fallen service men and women are treated with dignity and respect during a very difficult time. Given the questions raised over the life insurance program we administer for the Department of Veteran Affairs, we welcome an opportunity to address the concerns and to set the record straight.” Stangfield denied doing anything wrong. “Prudential does not in any way take money from beneficiaries,” the company said according to CNN.

MetLife also commented. According to CNN the company’s spokesman John Calagna released a written statement saying, “However we strongly disagree with many misleading statements in recent media reports and want to be clear regarding several important features of MetLife’s Total Control Account (’TCA’). Our materials carefully explain the TCA to our customers so that they understand that they can use their checkbooks to withdraw all of their benefits immediately or over time as they choose,” Calagna told CNN. “They have full access to their funds and earn a guaranteed minimum interest rate that exceeds what they could earn on most money market accounts.”

Secretary of Defense Robert Gates told CNN he had no idea many military families were being treated this way. “Until today, I actually believed that the families of our fallen heroes got a check for the full amount of their benefit,” Gates told CNN during a Pentagon briefing. “So this came as news to me. And so I will just say I will be very interested in the outcome of an investigation.