Wheaton family blames radio personality for more than $134K investment loss

A new NBC News poll shows more than 60 percent of Americans are concerned about the current state of the economy and what it means for their financial future.

That includes a Wheaton family who put their trust into someone they thought was a financial advisor but ended up costing them thousands of dollars.

On weekday mornings, radio listeners who dial into AM 820 will hear from Richard Chew, a self-proclaimed "wealth management and insurance veteran." The show was one of the reasons the family decided to hire Chew.

Facing the looming cost of two college tuitions for his kids, Phil turned to Chew for financial advice in 2019.

"It was part of his 'Income for Life' strategy," said Phil.

Now Chew's client, Phil and his wife put $345,000 into an indexed universal life insurance policy with Lincoln Insurance over three years. Phil said it was supposed to be a low-risk investment.

"It was going to generate almost $29,000 a year," said Phil.

A few years passed, and when Phil finally saw his policy statement, he noticed thousands of dollars in what he assumed were monthly fees.

"It just shows an asset charge $17,000, negative $17,000," said Phil. "We have so many fees on this thing, we wouldn't have money left in it."

Phil said Chew never explained how the policy was supposed to work and that the fees were all laid out in the policy documents. Experts explain that UIL policies are generally subject to several fees, including cost of insurance, administrative fees and a "percentage of premium" fee.

Phil said Chew was confused by the fees. And instead of explaining them to Phil, Chew blamed Lincoln Insurance. In a letter written by Chew, he accused the insurance company of increasing "their cost of insurance charges" and "underwriting benefit" without his knowledge.

"When I asked him [why], one of the reasons was 'COVID.' I said, 'What does COVID have to do with a life insurance policy?' And he said, 'Well, there's been a lot of natural disasters,'" said Phil, who added that Chew didn't elaborate.

Panicked, Phil said he took Chew’s advice once again and cancelled his policy.

"We pretty much followed him to get in and then we followed him to get out," said Phil.

Phil ended up paying $65,000 in surrender charges, an amount he said Chew promised to get back to him, along with the fees that had paid for the policy, for a total of $134,000.

He said Chew promised to get his money back by filing a claim with his Errors & Omission insurance company. Errors and Omissions (E&O) insurance for financial professionals is a type of liability insurance that protects them from claims of mistakes, negligence or inadequate advice that cause financial harm to a client.

"He says that he, on a professional level, he feels 'responsible to do everything I can to make sure this where [we're] made whole,'" said Phil, reading from a letter Chew sent to his E&O insurance company in December 2023.

Chew's letter goes on to say, "I fully recognize as the writing agent that some of the … changes would normally be presented to the policy holder by me, Richard Chew. However in this case I was never notified by Lincoln of the changes."

NBC 5 Responds found there was a reason Chew wasn't in contact with Lincoln Insurance. Just months after Chew sold Phil his policy in 2019, Lincoln Insurance confirmed it "terminated" its relationship with Chew. It's a rare move and, according to Joni Alt with the National Association of Personal Financial Advisors, a major red flag.

"Maybe this person didn't follow the rules or there was some other negative stuff that was actually happening and they decided they no longer wanted that person to be associated with [the company]," said Alt.

Another possible reason for that termination? Over the past nine years, Chew has registered multiple finance companies with the State of Illinois, all with similar names and all dissolved within about a year. The dissolved companies include: 1st Capital Insurance Group LLC, 1st Capital Finance Group LLC, 1st Capital Business Finance Group LLC, 1st Capital Insurance and Wealth management Group LLC.

At the time he sold Phil the policy with Lincoln, according to state records, Chew did not have an active business.

Alt said that's another red flag.

"My guess is after one or two [LLCs], there's really an answer that is not the answer you want to hear. It's probably not the right answer. And he shouldn't be doing this any longer," said Alt.

Phil said he was never told of the termination, by either Lincoln Insurance or Chew. Phil said he believes his policy was essentially left unmonitored for several years. Phil admits he wasn't monitoring the policy, because he believed that was Chew's job.

A year and a half after taking Chew’s advice and cashing out the policy, Phil said Chew has stopped answering his calls and emails, and he hasn't seen a penny of the money he was promised.

"[It's] going to be tough to get over," said Phil of the money he's lost.

NBC 5 Responds wanted to know if Chew was telling the truth about those fee changes to Phil's policy — or just failed to do his job and didn't understand the policy he was selling.

After eight months of digging, we found, according to Lincoln Insurance, they never raised the fees like Chew claimed.

Neither Chew, Lincoln Insurance nor AM820 responded to NBC 5 Responds recent requests for comment.  

For months, Phil said he wondered if Chew ever actually filed the E&O claim he was told could get his money back. It wasn't until NBC 5 Responds reached out to the E&O company earlier this year to inquire about the status of the claim, that it reached out to Phil.

Phil's attorney said they're now negotiating a roughly $70,000 settlement, just over half of what Phil lost.

"I have a hard time believing I'm the only person that he sold this to that he's having an issue with," said Phil.

Key Takeaways

Alt says anyone can call themselves a "financial planner" without consequence, so it's important to take steps to verify the person you choose to handle your money is trained and certified to do so.

• If you're looking for a financial planner, find someone who is registered as a Certified Financial Planner or CFP. They are held to a fiduciary standard and they have to put their clients' best interests first.
• Alt says legitimate Financial Planners will require you to sign a contract, outlining their responsibilities.
• Check to see if their record is in good standing, by going to BrokerCheck.Finra.Org
• Even if you have a financial planner, keep checking your own financial statements as soon as you get them and don't assume they will catch everything.