by John Darer CLU ChFC CSSC RSP Is it EVER acceptable for your structured settlement broker or settlement planner to sell, or offer to sell lists of names, contact information, specific payment information, of your client(s) or annuitant(s) to a factoring company?
I throw this very serious question out to public debate:
- To other structured settlement brokers
- To Plaintiff lawyers
- To Insurance companies that hire structured settlement brokers
- To life insurance companies that (i) appoint structured settlement brokers (ii) may deliver privacy statements to annuitants through their appointed agents in delivery materials and possibly through other mailings and correspondence with annuitants
- To the Board of Directors of the National Structured SettlementsTrade Association
- To the Board of Directors of the Society of Settlement Planners
- To the National Association of Settlement Purchasers.
- To Patrick Hindert, as an industry commentator. Pat has yet to tackle this issue and I wish he would.
I have heard from both brokers and annuitants over the years with similar stories where an expectation of privacy has been breached. People have alleged they have received unsolicited telephone calls at unlisted phone numbers!
I have recently learned from a completely different factoring source that such offers have been made by certain structured settlement brokers within the last 12 months (i.e. in 2011-2012).
In the past 30-45 days I have personally been solicited by someone by telephone asking me if I wanted to give up client information to a buyer of structured settlement payment rights. I refused, but after several minutes of probing the caller gave it up that he was representing someone who is mainly on the primary side of the industry
Additional questions
Is any one being harmed by this corpulent behavior?
Are the brokers who are selling or offering to sell the private information to factoring companies then taking an undisclosed commission or kick back when the factoring broker or factoring company closes a deal from the list of names?
How can a plaintiff lawyer or other stakeholder better protect themselves and their clients from the potential fallout?
Notes:
in case I have not been clear enough, we're not discussing whether or not factoring is OK. Sometimes it is. We're not speaking about an isolated referral. We are talking about the sale, or an offer to sell more than one person's private information with the knowledge that these unwitting annuitants will be solicited to sell by a factoring company.
It is not believed that this practice is widespread, but having heard from different sources in the factoring industry that they have personally been approached, in my opinion it's "Houston we have a problem".
If you are an annuitant that believes that you received an unwarranted solicitation to an unlisted number I'd appreciate hearing from you.
I first heard a story about a structured settlement broker approaching factoring companies offering to sell lists of structured settlement annuitants in mid- 2007 from a factoring representative that represented to me that THEY had been approached. At or about the same time, in August 2007, a structured settlement broker sent an email to a structured settlement general agent reporting that one or more of her clients were being solicited "out of the blue" by factoring companies when they thought their structured settlement transaction was supposed to be confidential. That email was distributed by the general agent to others affiliated with the same general agency. I have copies of those emails. Here is one, with names redacted Download Email from TX structure broker to General Agency Head re name selling
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