AUSTIN - Texas Attorney General John Cornyn sued direct mail company owners Cecil Gaskamp and Christopher Etheridge who own The Lead Connection and Seniors Security Services (SSS). These Dallas area businesses mail notices to senior citizens which appear to be official government correspondence and urge seniors to contact SSS for further information on how to protect themselves. In fact, SSS is paid to solicit leads for insurance salesmen who then attempt to sell seniors Long Term Care and Burial ("final expense") Insurance.
"These sleazy sales tactics violate the law and must stop," Attorney General Cornyn said. "I will not tolerate a sales pitch that begins by frightening seniors into thinking they're about to lose their Social Security or healthcare benefits. This isn't fair to our senior citizens or to the many excellent insurance agents in Texas who play by the rules and market their products legally and ethically."
The SSS mailings are sent in envelopes designed to mislead recipients into thinking that they are official communications from the federal government. The mailings bear the return address of Seniors Security Services and display an emblem that closely resembles a federal seal next to the address and the words "Important Update" printed in large, bold letters. Enclosed information warns seniors that government programs such as Medicare and Medicaid will be unable to provide long term care assistance to them and urges them to learn about changes in the tax laws which will affect their long term care benefits. Seniors are instructed to return the postage paid card to SSS to receive the important information.
Defendants' activities, according to the OAG lawsuit, violate the Texas Insurance Code and the the Deceptive Trade Practices Act. The mailer creates confusion and alarm, misleading citizens into believing that their federal benefits are in jeopardy, and that they must send in the reply card for more information. In fact, the only purpose of the mailers is to generate leads for insurance agents. The mailers do not disclose that purpose or intent at all, never mention the word "insurance" and do not identify any licensed insurance entity as required by Texas law. An average citizen would have no idea that the true purpose behind these cards was to sell an insurance or investment product.
The lawsuit asks the court for an injunction prohibiting the misleading mailers, civil penalties to be paid to the state of up to $10,000.00 per violation, attorneys fees and investigative costs.
Assistant Attorney General Mari Robinson, in the Insurance Practices Section of the Attorney General's Consumer Protection Division, is handling the case.
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