by Structured Settlement Watchdog
As part of ongoing commentary and examination of potential conflicts of interest on the structured settlement primary, secondary and tertiary markets and how companies are addressing (or not addressing) them, the New York Court records has helped connect a few dots.
Question for Plaintiff Lawyers
As an initial matter, would you feel comfortable to know that your structured settlement broker or settlement planner marketed factoring to the very same clients that you introduced to him or her to place a structured settlement?
A sampling of New York structured settlement transfer petitions submitted by CrowFly, sourced from publicly available court records
Case Number 1
In 2012, John Bair, CEO of Milestone Consulting placed a structured settlement with Pacific Life and Annuity Company on Robert Dungan. CrowFly LLC included the same annuity policy as an exhibit to Dungan's structured settlement transfer petition submitted to the New York State Supreme Court in Cattaraugus County January 14, 2021. See links immediately below.
Upon information and belief John T. Bair was the CEO of both Milestone Consulting and CrowFly, LLC in January 2021. In what was described as CrowFly's new company brochure and available for download on December 16, 2021, Bair is described as CEO and co-founder of CrowFly, LLC. The Adobe meta info for the brochure shows it was produced in August 2021. A video posted to Vimeo 8/2/2021 captioned Bair as CEO. In January 2022, the company issued a press release announcing that Nita Bhatia had been elevated to CEO.
Case Numbers 2 & 3
Dutchess County 2020-53424 CrowFly, LLC vs Alexander Arrighi submitted October 23, 2020. The structured settlement had been placed by Milestone as part of the settlement of a Westchester County podiatric malpractice case in January 2014 with Liberty Life Assurance Company of Boston (now Lincoln Life Assurance Company of Boston). It was a client of Robert F. Danzi, a plaintiff lawyer from Jericho New York. A 6.02% discount rate was charged according to the statutory disclosure in Dutchess County court records. CrowFly paid $40,000 in exchange for about $81,000 in future payments, the farthest out part of the payment stream. No Independent Professional Advice.
Orange County Florida 2021-CA-011451-O: CROWFLY LLC vs. A. A. Just a year later CrowFly factored the next closest year of Alex Arrighi's structured settlement payments on the Lincoln Life structure. $12,500 now for $26,280 in payments from 2030.
In addition to the signature block which is poorly disguised so as to remove all doubt as to it being Mr. Arrighi, the publicly filed Florida disclosure (Exhibit B to the Petition says this. How do you pay for something and not be responsible for it? How many eyes looked at the disclosure?
Case Numbers 4 & 5
E67244 11/14/2019 CrowFly, LLC v Becky L. Frens et al
E69595 12/15/2021 CrowFly, LLC v Becky L. Frens et al.
A structured settlement was placed by Bair with Prudential Insurance Company of America from a Qualified Settlement Fund in 2009, when Bair was a principal of Forge Consulting in Buffalo. The QSF trustee Mike Dansa CPA of Dansa D' Arata & Soucia, a Buffalo based accountant (also Bair's accountant, according to our sources) was the QSF trustee. I understand that he has acted as a QSF trustee on other cases with Bair. The defunct Buffalo law firm of Siegel Kelleher & Kahn was the lawyer of record when the structured settlement was established. Siegel Keller & Kahn paid Mike Dansa's fee according to court records. The above two transfer petitions were subsequently done by CrowFly, LLC for a transfer of structured settlement payments
In previous posts we've drawn attention to the inherent conflict of interest that exists between a series of entities (literally having been under one roof), that solicit pre-settlement cash advances, structured settlement annuities, the factoring and refactoring of structured settlement payment streams and the marketing of the payment streams to investors.
In a recent press release, CrowFly boasted of a 300% increase in business. Given the above sample, it seems reasonable to ask how much of that was obtained from remarketing structured settlement payees referred by the nation's trial lawyers and from structured settlements placed by John Bair?
In a July 23, 2020 blog post I raised the question about a Need for More Transparency About Seventh Amendment Holdings, Milestone and CrowFly stating
"John T. Bair has written several blog posts on behalf of Milestone Consulting, LLC and Crowfly, LLC questioning the relevancy of structured settlements Milestone Consulting has communicated to trial lawyers to eliminate annuities from their client portfolios and settlement plans on April 20, 2020. Milestone and CrowFly, LLC operate out of the same address, 737 Main Street, Suite 100 in Buffalo, New York. In spite of adopting the trendy fintech label, John T. Bair put in writing in an October 3, 2018 communication, from his Milestone Consulting email to a third party in the secondary market, that he is "the only primary market and secondary market origination firm that he knew of". I believe he may have been the second after the Delta Settlements/Rescue Capital combo in or around 2012.
The Consumer Financial Protection Bureau defines origination as "any service involved in the creation of a federally related mortgage loan, including but not limited to the taking of the loan application, loan processing, the underwriting and funding of the loan, and the processing and administrative services required to perform these functions. Structured settlement factoring origination is something different than simply a fintech platform.
Reasonable Questions Asked in 2020
- Has Milestone Consulting, LLC, or any of its employees, provided its list of structured settlement annuitants, or any of their protected information to Crowfly, LLC?
- Has CrowFly approached an annuitant, or shopped their structured settlement payments rights, placed by its Director and Co-Founder and Primary Blogger John T. Bair, through Milestone Consulting in the last 5 years?
- Has there been any attempt by John T. Bair directly, or indirectly through any entities that he owns or is a director of, soliciting, or facilitating the solicitation of any annuitants he solicited and placed into structured settlement annuities through Milestone Consulting, Forge Consulting, or EPS Settlements and making any profit on those deals?
- Do John Bair's origination activities, as characterized in the October 3, 2018 email go exclusively through the CrowFly platform or by some other means?
- What profits is any entity associated with John T. Bair taking (1) on the factoring of structured settlement payment rights (2) on the assignment of the rights to an investor or investors?
In closing let's be crystal clear, structured settlement factoring is not illegal. Bair's case is striking because of the unusually aggressive communication in April 2020 about getting clients out of structures and annuities. Moreover, CrowFly recently announced that it had joined the National Association of Settlement Purchasers (NASP). I think we're speaking of an obvious question of optics and perception. Companies with common ownership that place structured settlement annuities, actively participate in the factoring and refactoring of structured settlement payment streams and marketing of factored payment streams to investors. In 2006, when Allstate began its Advanced Funding Exchange program as a lower cost alternative for its own annuitants, so many settlement planners whined about the conflict of interest. Same in 2018 when Berkshire Hathaway introduced its Hardship Exchange Program.