So Citigroup is the latest institution deemed "too big to fail." Here's the part I don't understand. The New York Times is reporting that Citigroup is going to get $306 billion in guarantees and an infusion of $20 billion.

Isn't this the same Citigroup that was whining that it should have been permitted to purchase ailing Wachovia? Isn't this the same Citigroup that has sued Wachovia and Wells Fargo becuase it ended up the loser in that deal? Did the Feds tell Citigroup to stop stupid litigation while they were at it?

There shouldn't be anything that is deemed "too big to fail." What happened to "Joe the plumber?" Has he now been forgotten? Have all the small and large businesses that are struggling to make a profit and pay taxes been forgotten? I'm disgusted by this.

When a financial giant like Citigroup makes bad decisions, the government bails them out. When small businesses make bad decisions, the government is nowhere to be found. Make up your minds, folks.

That's the ticked-off view from The Law Planet - Jupiter, Florida

Here's the deal. Equity Index Annuities look and smell like a security but for reasons that escape me they are regulated as fixed insurance. I have written about this before. An insurance agent, with no securities training, could sell a product whose performance is dependent upon the movements of the stock market. And that's the good part.

The bad part is that most buyers don't understand what they're buying and their agents are making it less than clear as to what they're selling. I have handled some of these cases. I have a sense of what's going on.

And while an equity index annuity touts its "value," the fact is that the value is usually paid out over a fixed term. It is not a surrender or liquidation value. In a recent article in Investment News, the general counsel of an EIA issuer actually used the same BS line that insurance salesman use when they don't understand the product. She said a variable annuity would have decreased in value over the last year while an EIA would still be worth the same amount.

Unless her company's EIAs are different than the others I've seen, that's a load of crap! It shows that the lack of understanding of this product goes to the highest level. If the client actually wants the full amount available in the EIA, he/she loses a big chunk to penalties and fees. I repeat, this is a roach motel for your money. Stay away. This is why the securities regulators are stepping in. Someone with some market savvy needs to examine this garbage.

That's the view from The Law Planet - Jupiter, Florida.

I have been handling securities arbitrations for over 20 years. Every once in a while, the arbitrators saw the other side's case for what I believed it was -- nonsense. This has happened a few times over the years.

I heard about a case that was being tried before FINRA in Boca Raton. The premise of the claim seemed flimsy to begin with. Money had been stolen by a broker and returned by the brokerage firm, Merrill Lynch to the customer. The claim appears to be for, in part, lost investment opportunity. The broker did not appear during the arbitration hearings. At a point in time, she said she was not appearing because she was "awaiting sentencing." Those are usually not helpful words.

But it appears that Merrill did the right thing and paid back the customer the money that was stolen. But in something that I cannot recall ever seeing before, there is a nearly two page recitation of the procedural issues in the case. There are issues dealing with amendment of pleadings, appearance of witnesses and the possiblity of depositions. This case was war.

The arbitrators sided with Merrill Lynch and against both the Claimant and her broker. The panel awarded both the Claimant and Merrill Lynch their attorneys' fees against the broker. But that's not the unusual part.

The unusual part is the assessment of the arbitration costs jointly and severally against the Claimant and her lawyers. That is very rare. In case anyone reading the award thought that the panel was happy about this case, the assessment of costs against the lawyers pretty much puts that notion to rest.

Some days, the dog bites you and some days you bite the dog. I don't know who plays which role, but somebody got bit.

That's the view from The Law Planet, Jupiter, Florida.

Check out this blog which demonstrates that the cost of entry is too low and someone has too much time "on their hands."

I guess the good news is that it's not "Brokers standing on a ledge."

That's all for now from The Law Planet - Jupiter, Florida

I was recently retained to represent a client who was both an insurance agent and a registered representative with a related entity. The client was terminated by the insurance company and the broker-dealer. The U-5 that was filed became a problem.

The broker-dealer disclosed on the U-5 that there were two customer complaints from insurance customers regarding fixed insurance products. While this was true that there were two complaints, I felt (actually, I knew but I was being modest) that the disclosure was improper. I wrote to the company and told them to change things.

The company's lawyer wrote back and advised that he felt that the disclosure was proper under U-5 question question 7E(3)(a), which references U-4 question 14I(3)(A). This is essentially a question about the existence of yet-unreported customer complaints. The insurance company/broker-dealer felt that fixed (as opposed to variable) insurance complaints were reportable. I knew they were not.

The FINRA website held the key. FINRA advises that only complaints concerning a security, variable contract that is subject to regulation under the federal securities laws, or commodity exchange product are reportable . Other complaints are not.

There is one caveat, however. If the complaint relates to fixed insurance and alleges forgery, theft, or misappropriation or conversion of funds or securities, then it is reportable on a U-5. This is a slight, but important, difference.

After being educated in their wayward ways, the broker-dealer agreed to arrange to remove the improper disclosures.

That's the view from The Law Planet, Jupiter, Florida.