CLIENTS FILED AN ARBITRATION ALLEGING THAT IN OCTOBER 1989, AUGUST 1997, SEPTEMBER 1997 AND DECEMBER 1997, THE REPRESENTATIVE INVESTED THEIR MONIES IN PRODUCTS THAT WERE INCONSISTENT WITH THEIR FINANCIAL OBJECTIVES. CLIENTS FURTHER ALLEGE REPRESENTATIVE FAILED TO INFORM THEM THAT A SURRENDER CHARGE WOULD BE INCURRED FOR REDUCING THE DEATH BENEFIT AND PREMIUM PAYMENTS ON THEIR VARIABLE UNIVERSAL LIFE INSURANCE POLICY, AND FURTHER ALLEGE THIS POLICY LAPSED AS THE RETURNS ON THE POLICY WERE INSUFFICIENT TO CONTINUE PAYING THE PREMIUM. ADDITIONALLY, CLIENTS ALLEGE THAT THEY SUFFERED LOSSES AS A RESULT OF REPRESENTATIVE'S FAILURE TO TIMELY COMMUNICATE THE CHANGES IN THE MARKET AND ADJUST THEIR INVESTMENTS ACCORDINGLY. THE ALLEGATIONS BROUGHT FORTH IN THE COMPLAINT ARE DENIED.

$1,920,000.00

$9,999.00

IN 2003, THE SAME PARTIES FILED A COMPLAINT WITH NEW ENGLAND LIFE INSURANCE COMPANY AND PENN MUTUAL LIFE INSURANCE INVOLVING THE SAME OPERATIVE FACTS. THE NASD WAS NOTIFIED, NASD EXPLANATION NO. E8A030964, AND THE FILE WAS CLOSED BASED UPON A LETTER FROM THE NASD RECEIVED ON JUNE 9, 2004. THE CIVIL LITIGATION WAS VOLUNTARILY DISMISSED AFTER ORIGINALLY BEING STAYED, PENDING FINRA ARBITRATION. THE FINRA ARBITRATION WAS SETTLED BY MEDIATION WITH NO ADMISSION OF GUILT OR LIABILITY. THE TOTAL AMOUNT FOR ALL CLAIMS TO ALL CLAIMANTS WAS $9,999.

CLIENTS ALLEGE REPRESENTATIVE WAS NEGLIGENT IN HIS OVERSIGHT OF THEIR ANNUITY CONTRACTS PURCHASED IN 1990 AND MUTUAL FUNDS PURCHASED IN 1997.

$200,000.00

AFTER INVESTIGATION, PRIOR FIRM DETERMINED REPRESENTATIVE ACTED APPROPRIATELY AND NO WRONG DOING WAS FOUND. **11/3/2003 WAS THE DATE THE FIRM WAS NOTIFIED OF THE COMPLAINT***

CLIENT ALLEGES HE WAS MISREPRESENTED IN REGARDS TO A VARIABLE LIFE PRODUCT HE PURCHASED IN JANUARY 2000.

$40,956.00

CLIENT COMPLAINED DIRECTLY TO THE LIFE COMPANY. REPRESENTATIVE HAS PREPARED A RESPONSE TO THE LIFE COMPANY, DENYING ALL ALLEGATIONS AND INCLUDING ALL CORRESPONDING DOCUMENTATION. INSURANCE COMPANY REVIEWED CASE AND RESPONDED TO CUSTOMER DENYING ALLEGATION OF MISREPRESENTATION BASED ON EVIDENCE PROVIDED BY REPRESENTATIVE AND DOCUMENTATION WITHIN THESE RECORDS.