by Structured Settlement Watchdog®
Einstein Structured Settlements, a settlement purchasing fringe player that has had ties to Fairfield Funding, has built up a solid reputation for publishing error laden and misleading information about structured settlements. Einstein Structured Settlements claim that it is the industry leader is false and grossly misleading for the reasons stated below.
I'm "happy" to give Einstein Structured Settlements the free publicity "that they deserve" because some of what Einstein writes about structured settlements is so bad and unreliable that we just have to laugh with them. Kind of like "kids say the funniest things".
In a feckless effort to explain how structured settlement annuities work, Einstein says:
A. "Jessica has to sue Donald in the court of law to recoup her losses. What ends up is Donald has car insurance and his company lets call them Geico ends up being the ones sued".
1. "Donald" doesn't just "end up having car insurance". Most states have minimum insurance requirements for licensed drivers. Requiring insurance means that most people have some coverage required to help pay for damage they cause, and the penalties for not complying help to get minimum cover for the rest. Virginia fines you $500 if it catches you without insurance, and makes you get insurance, and then puts that money into a fund to cover damage done by people who get into accidents without insurance.
B. "Rather then one gigantic lump sum being paid out. Settlors end up putting that money into a very special kind of annuity. This is the(sic) the injured parties can get an income stream for the rest of their life (depending on their age)".
Given that the majority of states have minimum policy limits of under $50,000, the amount that is left over after attorney fees have been paid could hardly qualify as a"gigantic lump sum". Einstein's use of the word gigantic should be taken about as seriously as "Dr. Evil" asking for a billion gagillion fafillion yen.
C."Sometimes structured settlement deals have a high cost of living increases built into it but the end goal of Jessica being financially dependent is now possible".
1. Setting aside, has "a high cost of increase" vs "high cost of living increases', isn't the goal of structured settlements to make the payee as financially independent as possible?
D. "The Internal Revenue Service has structured settlement anniuties (sic) listed as tax-free and are encouraged by the Federal government, and strcutred (sic) settlements are typically approved by judicial courts".
1. The Internal Revenue Service does not have structured settlement annuities listed as tax free.
2. Internal Revenue Code Section 104(a)(1) provides an exclusion from gross income for amounts received under workmen’s compensation acts as compensation for personal injuries or sickness.
3. Internal Revenue Code Section 104(a)(2) provides an exclusion from gross income for the amount of any damages (other than punitive damages) received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal physical injuries or physical sickness;
4. An annuity contract is considered a "qualified funding asset" pursuant to Internal Revenue Code Section 130(d)
Another "F" for Einstein Structured Settlements on structured settlement essentials.
Einstein's claim to be an industry leader is just ridiculous from any angle.
From a business volume standpoint, if JG Wentworth now accounts for 80% of profits of the structured settlement secondary market Einstein, is competing with the rest for the 20% and this simply makes Einstein's claims wishful thinking.