by Structured Settlement Watchdog
Altium Group, LLC advertises that 'Secondary Market Annuities are a High Yield, Low Risk financial investment vehicle. The Holmdel New Jersey company also claims to " provide you safe, insured returns up to 8.00%. Invest in your future'.
Structured Settlement Derivatives have been misrepresented as annuities by a number of actors in the structured settlement tertiary market who know that structured settlement payment rights are in fact not annuities, and in doing so, attempt to 'disclaim liability for legal, accounting, tax, financial or other advice or guidance of any kind to purchaser"
The Altium pitch also includes
"By nature of the secondary market purchase process, Secondary Market Annuities come at substantially higher returns than similar annuity products purchased from the same insurance carrier" Altium Group website retrieved January 23, 2017
The safety and yield of Secondary Market Annuities (SMA) have proven to be an attractive asset class to many publicly-traded companies over the past two decades".
Pennsylvania residents Robert and Linda Wall are two such investors, who with the aid of a financial advisor purchased the rights structured settlement payments from Altium. In a case that underscores the clear and present danger of investing in structured settlement derivatives, the Walls invested more than $150,000 for the future payments that were supposed to be transferred to them, but never received any of the structured settlement payments, because the underlying transfer was vacated by the judge. The Walls brought breach of contract, unjust enrichment, negligence, and other claims
According to a legal complaint filed in July 2016,
- "On November 8, 2011, the Walls and Altium signed a “Master Structured Settlement Receivable Purchase and Sale Agreement and Non-Circumvention Agreement.” Under this agreement, the Walls wired Altium a $5,000 deposit on the purchase price and agreed to wire Altium the balance upon receipt of the Closing Book.
- Corona Capital then arranged for the purchase and transfer of Kenneth Stevens’ structured settlement payment rights, payable under an annuity issued by New York Life Insurance. On January 12, 2012, Kenneth Stevens signed an “Absolute Assignment and UCC Article 9 Security Agreement” assigning his right to payments from New York Life to Corona Capital.
- Corona Capital then sold the right, title, and interest payments to Mr. Stevens’ annuity to Altium on March 15, 2012. A Florida state court granted Corona Capital’s petition to approve the transfer on March 28, 2012 entitling the Walls to receive 60 payments of $3,000 with 3% annual increase in payments beginning on June 1, 2014, and ending with the last payment on May 1, 2019.
- On April 19, 2012, Altium sent the Walls the “Closing Books” and the Walls wired Altium the remaining purchase price of $147,833.37.
- Over two years later, the same Florida state court vacated its March 28, 2012 Order and ordered New York Life Insurance Company to make the payments to Stevens’ attorneys and not to the Walls. Stevens had filed papers seeking to overturn the order and, “after extensive discovery”, the court concluded that Stevens “did not sign any of the documents submitted to this Court in support of the” Corona petition. In other words, his signature had been forged.
- The Walls paid $152,833.37 to Altium under the Master Agreement but never received payments from Altium or Corona Capital. The Walls sued Altium Group and Corona Capital for breach of Uniform Commercial Code (“UCC”) transfer warranties, breach of contract, and unjust enrichment. The Court stated it lacked personal jurisdiction over Corona Capital and dismissed it on November 22, 2016.
The investors brought suit against both the factoring company, Corona Capital, LLC a company managed by Eric Livingston and Altium Group, LLC, a company solely managed by William D. Coluccio [Robert Wall and Linda Wall vs Corona Capital, LLC and Altium Group, LLC WD Pennsylvania Case No. 2:16-CV-01044-MRH, filed July 15, 2016 ]. Corona Capital was dismissed on jurisdictional grounds. The Court then ruled "when, as here, the investor has no specific commercial relationship with the original injured party who sold the structured annuity, she may not sue the finance company for breach of transfer warranties under the Uniform Commercial Code but may sue the intermediary seller receiving her investment for breach of contract.
Each and every investor considering buying structured settlement derivatives (including trustees of trusts for injured parties), whether or not misprepresented as annuities (" secondary market annuities"), should make note of the defenses put up by Altium Group, LLC [ they could be put up by any other company]
- Sixth Defense put forward by Altium Group, LLC "The purported claims against...are barred by assumption of risk"
- Ninth Defense "to the extent that plaintiffs incurred the damages they allege, Plaintiffs failed to take reasonable steps
Pop Quiz on Assumption of Risk ( on which of these does the doctrine apply?)
- Beaned by a foul ball while watching a professional baseball game that you purchased a ticket for.
- Teeing up your son with your honker
- Surviving a multi-story fall, only to be attacked by a random lion that happens to be ambling by
Forgery of structured settlement transfer documents is not without precedent
- Thomas Rubino, a now former paralegal of the New York personal injury and factoring company law firm of Paris & Chaikin is an admitted forger
- Jose Manuel Camacho Jr., a lawyer used by many structured settlement factoring companies forged the signatures of 7 Broward County judges on more than 100 structured settlement transfer documents
An Annuity Sold email address was used in connection with transmission of court papers requiring notarization in connection with cases with phony defendants in a bid to game Google.
Attorney Edward Stone and I will be speaking on a panel about the risks of investing in structured settlement derivatives at the upcoming annual meeting of the Society of Settlement Planners in Las Vegas in March. Stone has represented and is currently representing a number of individuals seeking to have structured settlement transfer orders vacated for alleged failure to comply with structured settlement transfer laws.
Important Related reading