U.S. securities regulators filed civil charges against two brokers and seven others, saying they were involved in a scheme to profit from the death of terminally ill patients through variable annuity sales.

The Securities and Exchange Commission’s complaint, filed on Thursday as an administrative action, says Los Angeles-based broker Michael Horowitz, 39, was the mastermind behind the scheme to exploit people nearing death.

Variable annuities are investment vehicles designed to help retirees maintain a source of income. Typically, insurance companies that sell the annuities will agree to make periodic payments to people who purchase the product. But another common feature offered is a death benefit, in which the insurer pays the policyholder’s beneficiary under certain conditions.

According to the SEC, Horowitz recruited people to help him steal personal health information from hospice and nursing home patients so he could designate them as annuitants and sell the products to wealthy investors.

The SEC said that at least 16 terminally ill hospice patients who were designated as annuitants had no family or business relationships with the investors who ultimately bought the products.

Among the people he recruited was another broker, Moshe Marc Cohen, 38, of Brooklyn, New York, the SEC said. Together, they falsified a variety of documents, including forms designed to help determine if certain investments are suitable for customers, the SEC said.

As a result, the insurance companies “unwittingly issued variable annuities that they would not otherwise have sold.”

Later, the SEC said, Horowitz moved on from just selling to individual investors and pitched the products to large institutional investors as well in the hopes of boosting profits.

All told, the SEC said, the scheme led to the purchase and sale of $80 million in deferred variable annuities between 2007 and 2008, with Horowitz reaping $300,000 in commissions and Cohen getting $700,000.

The SEC did not disclose the names of the two men’s employers.

However, the brokerage database run by the Financial Industry Regulatory Authority identified Horowitz’s firm as Kovack Securities Inc., and listed him as still employed there.

Kovack officials were not immediately available for comment.

Cohen’s firm was listed in the FINRA database as Woodbury Financial Services.

According to a report filed with FINRA, Woodbury terminated his employment in 2008 over a failure to cooperate with an internal review of his sale of annuity contracts.

Lawyers for Horowitz and Cohen could not be immediately reached for comment. The SEC said the two were fighting the charges.

The remaining defendants, including one investment advisory firm, all settled without admitting or denying the allegations, and will collectively pay $4.5 million.