Spruce Point issues ‘Strong Sell’ on Aegon, sees 25%-50% long-term downside

Spruce Point Capital Management issued a report outlining why the firm believes and estimates that shares of Aegon (AEG) “face up to 25% – 50% potential long-term downside and market underperformance risk.” Spruce Point stated: “Aegon’s s primary distribution arm, World Financial Group – WFG, operates an aggressive multi-level-marketing business, which has faced allegations of being a pyramid scheme.” WFG generates a signification portion of Aegon’s results and exposes the company to high business risks, and Spruce Point contends that its concerns regarding WFG are supported by complaints received via Freedom of Information Act, wherein previous agents disclose criticisms regarding the company’s high-pressure tactics and cult-like behavior.