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May 29, 2016

Selling Structured Settlement | Cannot Completely Rely on Judge to Protect You from Factoring Vultures

by Structured Settlement Watchdog®

A slew of awful stories of structured settlement annuitants getting financially raped by settlement purchasers in transactions approved by judges that are supposed to

Court ordered judge
Judges' Scrutiny of Structured Settlement Factoring Transactions is Questioned After a Running Series of Hiccups

protect them, suggests that annuitants should be vigilant and always seek independent advice from licensed and credentialed financial advisers.

The National Association of Settlement Purchasers (NASP) includes the following misleading answer to Frequently Asked Questions about selling your structured settlement payments.

Q: Is it a bad idea to sell my future structured settlement payments?

Not if you know what you are doing, why you are doing it, and get good advice from a professional. You understand your financial, personal, and family circumstances and situation than anyone else. You have the added security of knowing that a judge will review the transaction and protect you from being taken advantage of.

A sampling of where things have gone terribly wrong for structured settlement annuitants and valid questions arise about the miserable performance of the judges in providing the protection that NASP suggests.

  • Cedric Martez Thomas   New York native, skunked by Novation Funding LLC, a company that continues to falsely advertise that it pays the maximum payouts, for a more than $1 million profit spread, approved by an Okeechobee Florida judge Gary Sweet in October 29, 2015. Just a terrible awful deal produced by Novation.
  • Lauren Ashley Nesbitt    Oklahoma native, skunked by Seneca One for a an estimate profit in excess of $1 million approved by Bryan County judge Mark Campbell. Another terrible awful deal for the consumer, produced by Seneca One.
  • Terrence Taylor victim of the Portsmouth Virginia circuit three ring circus presided by former Judge Dean Sword Jr that sees 11 sale transactions in 2 years approved.  Cover story in Washington Post in December 2015.  Currently in litigation.
  • T.D., Florida native, young father of two, whose disability rendered him unemployable skunked by a Florida factoring company in cahoots with an investment bank.  Fortunately A.D. was referred to a lawyer who negotiated the the transfer order to be vacated and A.D.'s payments were restored.  But Indian River Florida judge Cynthia Cox approved the bad deal, doing an incredibly poor job of evaluating the best interest of T.D.
  • X, a young New York native, skunked by New York factoring company into placing 2/3 of the net proceeds a suspect investment scheme paying an impossible interest rate. Online research showed that the leader of the factoring company was subject to a FINRA ban. Fortunately X retained a lawyer and negotiated a return of of the $1 million the factoring company "invested". Approved by New York judge.
  • Prince George's County Herman Dawson, who approved the lead paint structured settlement factoring deals involving Baltimore inner city minorities, some functionally illiterate,  involving sham independent professional advice, that led to a front page Washington Post story, reforms in the state of Maryland and a Maryland Attorney General lawsuit.

There is ALOT more bad news to come out about the structured settlement secondary market in the coming months including more questionable judicial approvals.

Until there is licensing and regulation of sales practices and business conduct as there is with any other financial profession the legitimacy of the settlement purchasing industry will be questioned.

Posted at 09:53 AM in Judges on Structured Settlement Factoring, Judges Responsibility and Structured Settlements, Structured Settlement Factoring, Structured Settlement Factoring News, Structured Settlement Protection Acts, Structured Settlement Transfers, Structured Settlement Watchdog® |

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Guide to Structured Settlements 2023

  • What is a Structured Settlement? What You Need to Know
    Structured settlements and what you need to know about them including a helpful introductory video featuring 2023 A.M. Best Client Recommended Structured Settlement Expert and Registered Settlement Planner John Darer® of 4structures.com® LLC
  • How Do Structured Settlements Work? How Structured Settlements Work
    How structured settlements work, including 4structures.com LLC's super helpful structured settlement flow chart/diagram showing how structured settlements fit in on the spectrum of settlement planning solutions.
  • Rated Ages and Structured Settlement Cost
    Rated Ages for Structured Settlement Annuities present advantages to all parties. Shift the mortality risk to a life insurance company whose business it it is to assess mortality risk to price its life insurance and annuities. Rated ages boost your structured settlement annuity benefit per premium dollar, or your yield on lifetime payments. Rated ages help to reduce the cost of funding a Medicare Set Aside arrangement where a Structured MSA, is being used { WCMSA LMSA or NFMSA].
  • Structured Settlement Annuity Companies 2023
    Which life insurance companies issue structured settlement annuities going into 2023? A list of current structured annuity issuers, the location of their home offices and their financial ratings from A.M. Best, Moodys, Fitch, Standard & Poors and/or other Tier1 NAIC ratings, with links to their websites and other useful information.
  • Treasury Funded Structured Settlements
    Treasury Funded Structured Settlements are a settlement option for the most conservative using the OTHER permissible qualified funding asset under IRC 130(d), United States Treasury Bonds in addition to, or instead of, structured settlement annuities. Treasury Funded Structured Settlements can also be used to fund installment sales, also known as structured sales and other non qualified structured settlements.
  • Compare Structured Settlement IRR to Other Settlement Alternatives
    Use the Taxable Equivalent Yield chart to help compare the Internal Rate of Return (IRR) of a structured settlement to other alternative or complementary investments. Need help with the chart? Call 4structures.com® LLC at 888-325-8640
  • Structured Settlement Payments | Types of Structured Settlements
    Ways You Can Structure Your Settlement Payments. With a structured settlement you can have more than one type of payment in a single contract. Different types of structured settlement payments can be customized and combined to meet your needs on a stand-alone basis, or in conjunction with other financial products. Diversify your structured settlement, if you wish, by funding with more than one annuity issuer, with treasury funded structured settlements, index linked structured settlement payments and market based structured .
  • Structured Attorney Fees for Tax Deferral for Contingency Fees
    Structured attorney fees is a financial strategy that offers a unique way to defer taxes for lawyers and law firms. Lawyers CAN structure their legal fees even if the plaintiff doesn't structure their settlement. There are multiple ways to structure your attorney fees, such as the an index linked structured settlement where payments are adjusted based on upside changes in the S&P 500 with no downside and a cap of 5%. Trial Lawyers may also use a special deferred pay/deferred compensation arrangement, if market based returns returns are desired with no cap. Plan NOW for year end! Put structured attorney fee expert John Darer® on your settlement planning team.
  • Structured Settlement Annuity Company Customer Service Phone Numbers
    Receiving structured settlement payments from your own structured settlement or inherited structured settlement? You'll like this huge time saver. Click for a comprehensive list of customer service telephone numbers that includes both current AND former structured settlement annuity issuers and reinsurers. If you have simple bank or beneficiary changes, or if the insurance company that issued the structured annuity has merged, sold or spun off its block of structured annuity business (e.g. Aviva, Allstate, Transamerica, AEGON, GE Capital, Liberty, CNA, Confederation Life) or changed its name and you're trying to track them down, here you go! The list is regularly updated. Last updated January 23, 2023.
  • Structured Settlement Quote Lock-Ins | What You Need To Know
    What does a Structured Settlement Lock-In Mean? How do plaintiffs, defendants and insurers benefit from a structured settlement quote lock in when finalizing a settlement? How does the defendant/insurer/court benefit from using a structured settlement lock-in? Where to be careful when using structured settlement lock ins.
  • What Are Structured Settlement Annuities?
    Structured settlement annuities are annuities that can provide one or more customized annuity payment streams in a single contract. Read about structured settlement annuities here.
  • History of Structured Settlements
    Tracing the roots of structured settlements history from 1918, when Congress exempted damages for personal injury or sickness from income tax, to the establishment of structured settlements as a core personal injury settlement planning tool to the present day.
  • What Are Market Based Structured Settlements?
    Market based structured settlements are an alternative or supplementary structured settlement solution for the plaintiff, attorney or law firm that: 1. Can afford to take some market risk 2. Have discretionary settlement dollars. Claimants and attorneys alike may find that market-based structured settlements provide the opportunity to receive tax-free income, or tax-deferred income, while enjoying growth potential.
  • iStructure |Uncapped Fixed Index Structured Settlement Annuity
    iStructure is an innovative game changing fixed index structured settlement annuity for plaintiffs or attorneys. with an intermediate to long term horizon

Qualified Settlement Funds

  • What is a Qualified Settlement Fund?
    Qualified Settlement Funds | What You Need to Know
  • Firmwide Qualified Settlement Funds Debunked
    Firmwide qualified settlement funds have been heavily promoted to trial lawyers, but have been debunked in a detailed analysis in a July 2022 legal opinion a tax partner at the law firm of Faegre Drinker Biddle & Reath, LLP. Trial lawyers and firms who have established Firmwide QSFs or coinsidering establishing a Firmwide QSF should read the analysis as part of their evaluation.

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About The Structured Settlement Blog

  • STRUCTURED SETTLEMENTS 4REAL® Blog Is a Popular Source of Structured Settlement News and Information, Settlement Planning News, Tax Deferral and Deferred Income Planning Solutions,
    with a stable readership that seeks credible structured settlement information and/or opinion about topical issues related to settlement planning, targeted to lawyers, injured persons and their family members, guardians, survivors, judges, magistrates, special masters, mediators, administrators, trust companies, insurance company executives and adjusters, financial advisers settlement professionals, financial professionals, insurance regulators, government leaders, federal and state law enforcement, buyers and sellers of structured settlement payment rights, the news media and other interested parties. 4structures.com LLC established the structured settlement blog in 2005 and for over 17 years it has been a leading source for critical commentary. The John Darer authored blog has been among the most prolific, regularly providing fresh structured settlement, settlement planning, litigation recovery management content and commentary. John Darer®, CLU ChFC MSSC CeFT® RSP CLTC, President of Stamford, CT based 4structures.com, LLC, is an experienced New York City area structured settlement expert, structured settlement broker, Certified Financial Transitionist, and Registered Settlement Planner. In his capacity as a investigative journalist and commentator, and professionally, John Darer passionately believes that shining the light on a business practice is both healthy and newsworthy. It is in the best interest of tort victims, their families and their legal advisers, that the settlement planning discussion involve those that are properly trained in the topic, properly informed on the topic and, with respect to structured settlements, properly licensed and/or appointed). It has significant instructional and deterrent value to other practitioners and firms as well as those who may be caught in the cross hairs. WHAT YOU GET here is the straight stuff with a touch of irreverence and humor. We hope you enjoy and find the content to be helpful. Subscribe to the structured settlement blog feed, or a specific category feed through your blog reader, or through the Feedburner icon on this page. Followers of JDDarer™ on Twitter may also receive select content. If you would like to speak with John he can be reached at (888)325-8640 Thank you for reading! Last updated October 10, 2022

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Structured Settlement Best Practices Corner

  • New York Insurance Advertising law requires the full name of the Insurer to be listed along with the city and state of the principal office. Stating that you represent these fine companies using Insurance company logos without the preceding information are also illegal
  • When it comes to settlement documents it is the ultimate responsibility of the lawyers or claims adjusters who receive input concerning the structured settlement aspects of the documents to actually read the entire document, exercise independent thought and advise their clients properly
  • Be aware that financial advisors use of testimonials is prohibited or restricted
  • Most states require that Testimonials represent the CURRENT opinion of the person who made the testimonial. Be prepared to back it up.
  • Number of States That Prohibit Payment of QSF expenses by licensed agents and brokers
    5 Survey not yet complete.

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Why Take a Structured Settlement?

  • A structured settlement offers guaranteed financial security to personal injury victims, wrongful death survivors and their families. A structured settlement involves a customized stream of payments, provides long-term stable tax-free income, for a period of years or a lifetime. Unlike other income annuities. a structured settlement annuity can have multiple payment streams to address multiple needs in a single contract.

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