Profiles of Purveyors of Structured Settlement Misinformation 2 | Annuity Sold

by Structured Settlement Watchdog

The misinformation about structured settlement transfer laws put forward by Annuity Sold forms the basis for a shout out concerning the weakness in Louisiana's structured settlement transfer laws,  that left Bobby Bourque and Peggy Bourque, and leaves other Louisiana residents open to attempted exploitation (in the Bourque's case by their own personal injury lawyer, the lawyer who fought for their recovery and would have counseled them to accept a structured settlement in the first place 16 months earlier). 

Annuity Sold claims "These days, 48 states in the United States have their own structured settlement transfer laws. The laws vary from state to state, but all of them require that the judge rule that the sale is in the best interest of the seller taking into consideration the welfare of the dependents. The flexibility of the laws allow judges to weigh the seller’s financial conditions against the need to sell the future payments".  However what Annuity Sold says is false because Louisiana is one of the states that unfortunately does not require a judicial finding of "best interest".

In order to avoid a 40% Federal Excise Tax imposed by Internal Revenue Code IRC 5891 however,  a buyer of structured settlement payment rights, such as D&A Litigation Support LLC, in the Bourque case, would have to obtain a "qualified Order".

According to IRC 5891 (b)(2) , the term “qualified order” means a final order, judgment, or decree which—
(A) finds that the transfer described in paragraph (1)—  [There must be a finding]
(i) does not contravene any Federal or State statute or the order of any court or responsible administrative authority, and
(ii) is in the best interest of the payee, taking into account the welfare and support of the payee’s dependents, and

(B) is issued—
(i) under the authority of an applicable State statute by an applicable State court, or
(ii) by the responsible administrative authority (if any) which has exclusive jurisdiction over the underlying action or proceeding which was resolved by means of the structured settlement

Without a finding by the Court that the transfer is in the seller's best interest, a 40% excise tax is payable on the factoring discount.In the Bourque case, the December 2016 Order approving transfer signed by Acadia Parish Judge  (where the petition included a fraudulent representation of discount rate to the Court),  does not have a best interest finding!   Download Bourque 12-2016 Transfer Order NO Best Interest Finding.  D&A Litigation Support, LLC, the Puerto Rico Entity which lists David P. Daniel (i.e. David Patrick Daniel) as authorized person and the Houston personal injury lawyer's phone and fax number, must've believed that the December Order signed by Acadia Parish Judge was legit because they sent this letter  to Prudential as part of an attempted closing process on the structured settlement transfer. The June 2017 amended order did, although it was defective in other ways, such as misrepresenting the discount rate to the Court.

The factoring discount is defined at IRC 5891(c)(4) as "an amount equal to the excess of—

(A)

the aggregate undiscounted amount of structured settlement payments being acquired in the structured settlement factoring transaction, over

(B)

the total amount actually paid by the acquirer to the person from whom such structured settlement payments payments are acquired.

 

The undiscounted amount of payments, in the Bourque case amount to in excess of $3.2 million

The total amount that was on the December disclosure to be paid to the Bourques was $400,000

What's 40% of $2.8 million?   Not for the faint of heart.

Annuity Sold, rated C-, still has one of the worst ratings of structured settlement cash now companies from the Better Business Bureau.

Even two Annuity Sold competitors that filed Chapter 11 the last month have better BBB ratings of A+.