Conseco, the big finance company, admits its turnaround strategy has failed and it's expected to file for bankruptcy protection soon. The company is a major insurer and the largest lender to mobile home buyers. Its financial shipwreck may cause turbulence for many retirees who rely on payments from Conseco annuities.

Federal and state regulators say they are watching the Indiana-based company carefully but noted that the state insurance subsidiaries are required to be self-sufficient and should not be affected by the parent company's troubles.

However, some financial analysts said they feared a "run on the bank," with retirees and others rushing to cash in their annuities and insurance policies. Nearly $5 billion worth of policies could be redeemed with no financial penalties, observers said.

Conseco is the nation's 26th-largest life insurance company. It collected $5.6 billion in premiums last year and has 5.7 million policyholders. Its portfolio includes traditional life insurance, annuities and supplemental health coverage.

Conseco's troubles began two years ago, in what some say was a foreshadowing of Enron and other celebrated collapses. The company went on an acquisition binge, taking on a huge debt load that is now the basis of its plight.

Most observers see Conseco's purchase of Green Tree Financial as its downfall (story). Green Tree was the nation's largest lender in the mobile home market, which turned out to be much riskier than Conseco had realized.

Conseco hasn't been tight with a buck.

Shortly after the Green Tree deal, the company recruited General Electric wizard Gary C. Wendt as CEO, awarding him one of the lushest contracts in history, worth at least $75 million and gauranteeing him a retirement annuity of $1.5 million yearly. The company also made loans of nearly $550 million to its executives and directors. No one seriously expects any of those to be repaid.

Wendt is throwing ballast overboard as fast as possible. The company said Friday it would halt interest payments on about half of its $2.6 billion in bonds for at least the next 30 days.

Wendt is celebrated for his business acumen and for his bitter and very public divorce from his first wife, Lorna, several years ago. She sought to be compensated for her alleged role in Wendt's success at GE Capital.