FreeAdvice.com Article: "When Good Companies Go Bad" Details Extensive Wrongdoing by Fortune Magazine's "Most Admired" Life Insurer

    SAUSALITO, CA, April 19, 2011 /24-7PressRelease/ -- Over the past few years several high profile companies, recognized for their success and financial responsibility to their customers, were later revealed to be taking advantage of their customers' loyalty. This trend of corporate misconduct was recently continued when a Milwaukee court decided that the actions of Northwestern Mutual Life Insurance Company were intentionally and outrageously harming its customers. Such actions toward customers have caused many to wonder whether Northwestern Mutual should really be ranked at the top of Fortune Magazine's "Most Admired" list. Normally, as Warren Buffet - recently in the news in connection with management improprieties at Berkshire Hathaway - is fond of saying, "It takes 20 years to build a reputation and five minutes to ruin it." By those measures, Northwestern Mutual Life's five minutes are up.

A new feature article on the leading legal and insurance information site FreeAdvice.com -- "When Good Companies Go Bad" -- discusses how the once highly-regarded Northwestern Mutual Life appears to be living on its past laurels and pulling the wool over the eyes of oblivious customers and insurance regulators.

Court Finds Northwestern Mutual's Wrongful Conduct "Intentional and Outrageous"

FreeAdvice.com outlines a series of scathing findings in the March 7, 2011 decision by Judge Dennis Flynn in the class action LaPlant v. Northwestern Mutual Life. The case involves Northwestern Mutual changing the way it paid dividends to annuity-holders, by using only low-yielding short-term bonds, rather than the company's long-term investment portfolio. After a state court trial in the company's hometown of Milwaukee, Judge Flynn found that Northwestern Mutual had been breaching its contracts, violating its fiduciary duties, and cheating its annuity customers, and that Northwestern Mutual's doing so was "intentional and outrageous."

Judge Flynn also found that Northwestern Mutual engaged in "intentional and repeated concealment of wrongdoing over a period of a quarter century," misleading state insurance regulators and policyholders. While Northwestern Mutual plans to appeal Judge Flynn's decision, the FreeAdvice.com article reports that the facts revealed in a new putative class action pending in Federal court in Milwaukee, Smith v. Northwestern Mutual Life, Case No. 11-CV-71, and fully detailed at http://www.NorthwesternLawsuit.com, reveals how Northwestern Mutual Life Insurance Company has become worthy of contempt rather than trust or admiration.

Northwestern Mutual Invokes the "Wizard of Oz" Defense

The recently filed Smith case is a result of Northwestern Mutual's promise to hundreds of thousands of its life policyholders that it would charge "flexible" interest rates on policy loans and adjust the rates in line with long-term economic conditions. Instead, Northwestern Mutual has broken this promise by charging an inflexible 8% interest rate for 33 years. Despite major economic changes and historically low interest rates, Northwestern Mutual claims an 8% interest rate on no-risk loans is warranted by economic conditions. Northwestern Mutual has also asserted that only "the fine print" in its contracts should matter - that the court should disregard Northwestern Mutual's explicit promises that it would adjust the rates. The policyholder's lead counsel (see http://www.AdvocateLawGroup.com) contends Northwestern Mutual is engaging in a "Wizard of Oz" defense, invoking the "you can't believe anything we say" narrative.

FreeAdvice.com, online since 1996, is the most visited consumer-focused legal and insurance information website. It is a unit of Sausalito, California based Advice Company which also maintains offices in Bethesda, Marlyand. For more details on the LaPlant and Smith class actions against Northwestern Mutual, refer to this recent Advice Company article at http://insurance.freeadvice.com/nwm-1.

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