by Structured Settlement Watchdog
The structured settlement factoring forum shopping stories involving the Sunshine State continue to roll in and a prominent NASP member is implicated.
A 19 year old from North Carolina, who had lived in North Carolina since he was 4 years old was apparently able to circumvent the North Carolina Structured Settlement Protection Act*, thanks to a prominent member of NASP in 2009. The annuitant was lured to Florida with expenses for his travels to Florida which were wired into an account of a Florida "friend relative*", perhaps so that it could not be traced to him, the transaction was somehow approved in Broward County Florida, despite the man only being in Florida for a total of "one to two weeks" . The address used on the transfer paperwork was his grandmother's address in Putnam County Florida , his grandmother who "he hadn't seen since he was 5 years old". The NASP member had the annuitant write a short paragraph about his reasons for selling, which were generally valid reasons. The annuitant DID NOT appear in court for questioning by the Broward County judge as that is not required in Florida.
The man had no bank account in Florida, no Florida driver's license and again had not seen his grandmother since he was age 5 and no intent to domicile in Florida! The man apparently had some second thoughts but had no money to get home rom the trip that lured him to Florida.so the factoring company apparently leaned on him after he had no money to get home to North Carolina.
The man has since been hounded by other factoring companies about his remaining payments, including one who offered him $5,000 and said he didn't need to go to Florida, he could go to Georgia and South Carolina.
Ironically North Carolina resident said, during the time leading to the 2009 transfer, that he spoke to JG Wentworth and was told that its underwriting guidelines (at the time) precluded it doing structured settlement transfers with those under age 21.
IRC 5891 relates to the imposition of a 40% excise tax where its requirements regarding structured settlements factoring are not followed. One wonders what a comprehensive IRS audit of Florida structured settlement factoring transactions, by auditors who are properly trained in what to look for, would reveal and how much revenue the United States Treasury would generate.
*The North Carolina Structured Settlement Protection Act has discount rate caps that are below the comfort zone of some companies that offer "cash now"
**e.g. you call your Dad's best friend "Uncle Charlie", but he's not a blood relative