by Structured Settlement Watchdog
Remarketing of structured settlement annuitants who have sold a portion of their structured settlement to a factoring company is big business, particularly to those that also service structured settlement payments. Remarketing carries a much lower acquisition cost than new business.
Refresher on Servicing of Structured Settlement Payments
As the structured settlement watchdog, John Darer, has previously covered in this space, servicing of structured settlements is necessary when an annuitant only sells a portion of their payments, because many life insurance companies will not split structured annuity payments. When payments are being service the annuitant is frequently denied access to the life insurer for routine requests such as change of bank account, change of beneficiary and change of address and must instead deal with the servicing company. As has been corraborated by Dallas bankruptcy expert attorney Bruce Akerly, and the sitting general counsel of the National Association of Settlement Purchasers, in the extreme scenario involving the Chapter 7 bankruptcy of the servicer, the annuitant may experience delays and additional costs to protect their rights to the payments.
The structured settlement watchdog was distrurbed to hear from a source that some factoring companies are remarketing the structured settlement annuitants they service at less attractive rates than being offered on the open market.
Presented with the lower discount rate alternatives (better for annuitant) we have learned that some factoring companies are actually fighting their annuitants in Court hearings. This purportedly is occurring even though the payments haven't been transferred.
The other day RSL Funding issued a press release alleging that Imperial Holdings is suing their competitors who are offering lower rates. If this were true the litigation does not appear to be listed in its S1-A. Imperial is not the subject of the information provided by our source, but is this a coincidence that helps frame anti-consumer behavior by servicing factoring companies?
It's a subject that deserves further exploration and believe me we will, BEFORE it reaches biblical proportions.
We kick off our quest for the truth with this memorable ballad from "Satchmo". If you are one of the "Pharoahs" concerned we hope you will pay attention.