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Congress to Scrutinize Life Insurance, Mutual Fund Sales on Military Bases

Representative Max Burns (R-Georgia) plans to introduce a bill in the House today intended to prevent the marketing on military bases of financial products that...
September 7, 2004

Representative Max Burns (R-Georgia) plans to introduce a bill in the House today intended to prevent the marketing on military bases of financial products that might not be appropriate for young recruits. The bill is part of a broad effort by federal and state authorities to prevent abuses in the sale of life insurance and mutual funds to members of the military service. Burns' legislative district includes Fort Stewart, Fort Gordon and other large military installations. The bill would amend federal securities laws to prohibit the sale of contractual plans, a little-known mutual fund that is widely marketed on military bases.
 
"It is an outrage that financial products that were found so disreputable that they disappeared from the civilian market 20 years ago have continued to survive on-post, by being pawned-off on unsuspecting young service people as part of 'approved' savings and insurance plans," says Burns. "In addition, we have far too many unscrupulous insurance companies using federal military property to dodge state insurance commissioners and sell overpriced policies with virtually no oversight. We cannot allow those who defend our freedom to continue to be unfairly targeted for the sale of dubious financial products."

A hearing before the House Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises chaired by Rep. Richard Baker (R-Louisiana), entitled "G.I. Finances: Protecting Those Who Protect Us" will be held on September 9. In late August, an official at the Government Accountability Office said the agency is broadening a study of insurance sales to military personnel that was begun earlier this year.