by Structured Settlement Watchdog
"Key word stuffer" Platinum Financial Strategies of Lake Charles, Louisiana is yet another example of a structured settlement factoring broker that uses insurance terms in a misleading way as a search engine optimization and solicitation strategy.
A search for active companies with insurance licenses in Louisiana on January 24, 2011 came up empty for Platinum Financial Strategies and its Principal MIchael Potthoff. There was no company domiciled in Louisiana with the word Platinum in its name that even came up in the search results!
Let's examine some of the claims and statements made by Platinum Financial Strategies and see what is really questionable about the solicitation of investors by Platinum Financial Strategies:
A. "Structured settlement annuities are sold by structured settlement annuitants to Platinum Financial Strategies at a discount in exchange for a lump sum payment, Platinum offers these annuities for resale"
B. "Platinum Financial Strategies only offers annuities paid by insurance companies with high Standard and Poor's credit ratings".
With no insurance license in Louisiana how can Platinum Financial Strategies legitimately say it "offers annuities"?
C. "What if you could invest in those companies' products that provide the same level of trust for much higher that traditional market rates on investments that have comparably low risks?"
A secondary market annuity is not an annuity. When you invest in what Platinum Financial Strategies appears to be selling, you are investing in structured settlement payment rights, you ARE NOT investing in an annuity. A structured settlement annuity is a qualified funding asset that is owned (in the majority of cases) by a qualified assignment company and stays owned by the qualified assignment company regardless of whether or not the structured settlement payment rights are transferred by a structured settlement annuitant.
D. "Structured settlement annuity payments are made directly to the buyer by a US Based insurance company with a credit rating that is generally AAA to A by Standard and Poor's"
If you are purchasing a payment that is being serviced the payments may not come directly from a US based insurance company, they may come from a servicing company. Servicing arises where the annuitant is only selling part of their payments and the life insurance company that issues the annuity chooses not to split payments between the original annuitant and the buyer of the partial interest in payment rights (as is its option under the structured settlement protection acts). I've previously covered the topic of structured settlement servicing (and related issues) in this forum.
E. "A structured settlement annuity has been "previously owned" "
What Platinum says is rubbish. Structured settlement annuities ARE NOT "previously owned". As stated in C above, "a structured settlement annuity is a qualified funding asset that is owned (in the majority of cases) by a qualified assignment company and stays owned by the qualified assignment company regardless of whether or not the structured settlement payment rights are transferred by a structured settlement annuitant".
F. " Platinum Financial Strategies has a number of channels, including an extensive broker network, through which structured settlement annuities are acquired"
Total rubbish. Platinum Financial Strategies DOES NOT acquire structured settlement annuities through its "extensive network", it/they acquire structured settlement payment rights. There is a difference and it's not so subtle.
While as a foodie I'm a big fan of Louisiana cuisine, I'm not "Ben Yay" about "Filet Dumbo". Time to "kick it up a notch!"
Financial Literacy, GET IT?!