CUSTOMER COMPLETED AN APPLICATION TO PURCHASE A VARIABLE ANNUITY CONTRACT IN DECEMBER, 2012. CUSTOMER PRESENTED A CHECK DRAWN ON AN EMPLOYER PENSION PLAN AND INTENDED TO ROLL OVER THE FUNDS INTO THE VARIABLE ANNUITY. FUNDS WERE FORWARDED TO PRUDENTIAL INSURANCE, HOWEVER, PAPERWORK FOR THE ANNUITY EVIDENTLY WAS NOT RECEIVED BY PRUDENTIAL. PRUDENTIAL ATTEMPTED TO RETURN THE FUNDS TO THE BANK UPON WHICH THE CHECK WAS DRAWN. AS THE FIRM UNDERSTANDS IT, THESE FUNDS HAVE NOT BEEN CREDITED TO THE CUSTOMER'S PENSION PLAN ACCOUNT, AND PRUDENTIAL HAS ACKNOWLEDGED THAT THEIR CHECK FOR SAID FUNDS HAS NOT BEEN NEGOTIATED. CUSTOMER, IN A WRITTEN COMPLAINT TO THE SEC (WHICH THE SEC FORWARDED TO PRUDENTIAL, WHO SUBSEQUENTLY PROVIDED IT TO US)STATED THAT "SOMEONE HAS MY MONEY AND I SUSPECT [REPRESENTATIVE] MY ADVISOR". WE ARE FILING A YES RESPONSE TO QUESTION 14I.3.B. ONLY BECAUSE OF THE CUSTOMER'S ALLEGATION, WHICH IS OBVIOUSLY GROUNDLESS IN LIGHT OF THE FACT THAT PRUDENTIAL RECEIVED THE FUNDS AND SOUGHT TO RETURN THEM TO THE CUSTOMER'S PENSION PLAN.

$60,488.76

$1,722.04

CUSTOMER COMPLAINT WAS SETTLED BY THE INSURANCE CARRIER, THE FIRM HAS NOT BEEN ASKED TO CONTRIBUTE TO THE SETTLEMENT.