by Structured Settlement Watchdog
In "Five Landmark Events for Structured Settlements" Annuity.org indicates why Einstein Structured Settlements and the rest of the JRR Funding LLC "bugs" might need to look over their shoulder. In the meantime, pardon me while I "lift my leg":
Annuity.org makes the false and misleading claim that "They established the association to educate the public about the utility of the secondary market and increase the use of structured settlements".
FACT: NSSTA was not established to educate the public about the utility of the secondary market.
Annuity.org makes the false and misleading claim that "The NSSTA helps prevent settlement recipients from scams and makes sure that injured and disabled claimants have access to long-term financial resources"
FACT: NSSTA does not help "prevent settlement recipients from scams". Nor does it help protect them. According to its website, NSSTA is a trade association that offers the following benefits to its members
- Continuous updates and legal analyses of federal and state court decisions, laws and regulations
- Monitoring of Congressional and state legislative activity that impacts the structured settlement industry
- Hosting professional certification and continuing education meetings throughout the year
- Maintaining the only Internet site solely devoted to promoting the benefits of structures
COMMENTS: Depending on how it is designed, a structured settlement, offered through NSSTA members (and non-NSSTA members) may help ensure that an injured and/or disabled claimant has access to long term financial resources via the income stream that the structured settlement provides, to the extent that it helps prevent wasteful dissipation of assets. Seeking independent professional advice from a credentialed settlement consultant and/or financial adviser is an important step in the process that should not be avoided.
NSSTA and its members, including this author among others, support organizations that support the injured and disabled such as the American Association of Persons With Disabilities (AAPD).
Regarding Congress Confronting the Misuse of Structured Settlements
"In 1999, Congress conducted a hearing on the use of these awards and how the IRS should treat them. People who sold their payments shared positive and negative testimonies on the secondary market".
FACT: The hearings were about secondary market abuses of structure settlement recipients, not "misuses of structured settlements".
To wit, Annuity.org cites the following " 'I rise because of my very grave concern that the recent emergence of structured settlement factoring transactions – in which factoring companies buy up the structured settlement payments from injured victims in return for a deeply-discounted lump sum–completely undermines what Congress intended when we enacted these structured settlement tax rules,' former Sen. Max Baucus, D-Mont, said at the hearing".
FACT: Max Baucus, the current US Ambassador to China, was a Congressman only from January 3, 1975 through December 14, 1979, when he represented Montana's 1st District.Baucus was elected to the U.S. Senate on November 7, 1978 for the term beginning January 3, 1979, but was subsequently appointed to the seat by Montana's Democratic Governor Thomas Lee Judge on December 15, 1978 to fill the brief vacancy created by Senator Paul Hatfield's resignation. He complete six terms as a Unite States Senator. [Wikipedia]
FACT: The subject of the hearing was the Tax Treatment of Structured Settlements, NOT awards, was before Oversight subcommittee of The House Ways and Means Committee for the 106th Congress. Here is a list of committee members serving at the time. No Max Baucus. [ Source waysandmeans.house.gov] Here is a transcript of Thomas W. Little, former NSSTA President from the hearing on March 18, 1999. In it Little expressly states "Sens. John Chafee (R-R.I.) and Max Baucus (D-Mt.) introduced companion legislation last year with similar broad bipartisan support among (Senate) Finance Committee Members." (emphasis added)
FACT: Definition of Congressman "a member of a congress; especially : a member of the United States House of Representatives [Merriam-Webster] . Ergo, Max Baucus, a Senator, is not a Congressman. Rewinding to high school American history, or perhaps even earlier... The word "Congress" is used in the descriptive to refer to legislators from both houses of its bicameral legislature, the Senate and the House of Representatives. In order to distinguish who is a member of which house, a member of the Senate is typically referred to as Senator, (as in Max Baucus from January 3, 1979), and a member of the House of Representatives is usually referred to as Congressman/Congresswoman, or Representative
Annuity.org Also Misrepresents the Regulation of the Secondary Market
They state: "The annuity industry is regulated at the state level, as insurance agents, brokers and companies must obtain selling licenses from the state they reside in. Tax laws set forth by the Internal Revenue Service also help regulate the sale and ownership of annuities."
True, but none of the above has anything to do with the secondary market, where many of the people who approach and solicit you do not possess these licenses and many of the companies they represent are not even registered to do business in your state.
They state: "There are a few agencies involved in protecting the primary and secondary annuity markets. The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) oversee the variable annuity market, as agents must possess a securities license to sell these. The North American Securities Administrators Association (NASAA) assists in regulating state securities".
COMMENT If only these agencies DID regulate the structured settlements secondary market! There would be no fake testimonials, uses of aliases, UPS store mailboxes in lieu of a real address and more.
They state: "Another protection for this industry is through rating agencies for the companies issuing and purchasing annuities. AM Best, Moody’s, Standard & Poor and Fitch are all companies that can review businesses before you proceed with sales. Because these investments are not guaranteed by the Federal Deposit Insurance Corporation (FDIC), investors want to ensure that the company they work has a strong history and the resources to be responsible with funds."
COMMENT: Rating agencies are not a protection. If you read the disclaimers associated with the ratings you will learn that they are a form of opinion that you may (or may not) take comfort in. A.M. Best does not rate factoring companies or servicing companies, which you will encounter if you invest in structured settlement payment rights that have been split or diced into pieces, or a resold in the tertiary market.
The lighter side of Annuity.org
In the inimitable style of Einstein Structured Settlements' goofball writers, after a brief "sojourn" at a UPS mailbox on Las Olas Blvd in Fort Lauderdale near all the twinkling lights, fancy shops and sizzling nightlife, the neighborhood where the guy who originally played Tarzan and the Vice President who misspelled potato once lived, Annuity.org is back in Orlando, not far from Disney World where you can see Mickey Mouse and Donald Duck, or Shamu's Happy Harbor over at Sea World.