Misinformation About Non Qualified Assignments Feed

July 01, 2010

Dumb Things Said About Structured Settlements 2010-11: Non Qualified Assignments and Qualified Settlement Funds

by John Darer CLU ChFC CSSC RSP

Writer Louis Z. is typical of "factoring floggers" who feign credibility on the subject of structured settlements so they can sell (flog) something else. Like others he gets terminology and concepts wrong and in my opinion, clogs the information highway with erroneous information to the detriment of consumers.

In an Ezine article entitled "Understanding Qualified Structured Settlement Assignment and Funds" he states:

"There are two kinds of assignments in personal injury and workers comp cases. They are the qualified and the non qualified structured settlement assignment. A non qualified assignment is usually a periodic payment to the injured person but stays on the books at the responsible company. This non qualified assignment is not tax free and goes beyond the qualified structured settlement".

Comments:

  1. There is no such thing as a non qualified structured settlement assignment. It is simply a non qualified assignment. In most of the cases in the structured settlement process, there is first an obligation created by virtue of the release of claims which includes periodic payments, there is an assignment of that obligations and then a structured annuity is purchased to fund that obligation.
  2. A non qualified assignment IS NOT a periodic payment. It is method of transferring periodic payment obligations that do not fall within the guidelines of a IRC 130 qualified assignment.
  3. Thus a non qualified assignment does not stay on the books "at the responsible company"-whatever THAT means.
  4. Whether there is a qualified assignment or non qualified assignment the obligation is transferred/assigned off the books of the defendant/insurer/assignor to the assignee.
  5. A non qualified assignment has no tax status, however....see number 6
  6. The damages associated with a non qualified assignment of periodic payments are taxable. Since there is no exclusion under IRC 130 to exempt the assignee of non qualified periodic payments, the assignee in such cases is typically located offshore. The two such assignees in the market are located in Barbados and take advantage of a favorable tax treaty between the United States and Barbados.
  7. What does " go beyond the structured settlement" supposed to mean?

As to qualified settlement funds, Louis Z. erroneously states

"A qualified structured settlement fund must meet three requirements. It must be approved by a government entity, applicable under state law, and it must be an eligible claim".

EZine is essentially a posting service. The website owner appears not to screen experts. Credibility is hit or miss, mostly the latter. I have found the articles of little use to anyone seeking credible information on structured settlements. 


 

Posted at 01:03 AM in Dumbest Things Said About Structured Settlements Series, Financial Literacy, Misinformation About Non Qualified Assignments, Misinformation About Structured Settlements, Non Qualified Assignments, Non Qualified Structured Settlements, Structured Settlement Watchdog®, Structured Settlements | | Comments (0)

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January 18, 2010

Structured Settlement Services | Tulsa website's inaccurate Dick Risk "Retread"

by Structured Settlement Watchdog®

The structured settlement watchdog calls out not just one but two members of the Risk family in this post for lack of attention to detail.

From 2000-2006 Oklahoma attorney Richard B. Risk, Jr. (Dick Risk) was a prolific writer on the subject of structured settlements. Until he became an attorney Dick Risk was a producer of structured settlements and principal in Structured Settlement Services when the mantle was passed over to his son Robert Risk.

What appears to be a 2001 article written by Risk is posted on the Structured Settlement Services, LLC website, without citation, as "Structure Concept Being Reinvented". It is also on the website for the Risk Law Firm. That a 2001 article is being used in the present tense should not shock anyone. The structured settlement watchdog has already shown an appetite for nipping at the heels of certain structured settlement industry who state old behaviors a current fact.

Given that Structured Settlement Services, LLC contains the notation copyright 2007-2009. are we supposed to laugh, cry or pity them for what is misinformation?

Excerpt 1 "First Colony was followed by Berkshire Hathaway Life, Commercial Union (now CGU) Life, Monumental Life, American General Life and Allstate Life (although, possibly not in that order). Berkshire is no longer in the structured settlement marketplace".

Comment: How thoughtful to let their clients and readers know about Berkshire Hathaway and that Commercial Union is "now CGU".  But three of the other companies mentioned are no longer writing structured settlement annuities and haven't for many years.  And CGU became CGNU and Aviva before exiting the structured settlement business.

Excerpt 2  In disseminating information about Barco Assignments, Ltd the location of the company is incorrectly stated as Bridgetown Barbados when it is Belleville Barbados. All that Risk would have had to do is visit the Liberty Mutual structured settlements site to confirm.

Excerpt 3  Risk states that "the performance of BARCO and Liberty Life is guaranteed by a surety bond issued by Liberty Mutual Insurance Company", when such statement is neither currently true nor has it been true for many years!

Over on the Risk Law Firm website while the same incorrect information is displayed,  it is at least acknowledged that they might not be current or correct. A June 2008 Private Letter Ruling is added as a footnote to the piece. One wonders why Dick Risk simply didn't verify with Robert Risk the current markets.

Websites ARE NOT Ronco Showtime Rotisseries! You cannot set it and forget it!

Where has Attention to Detail Gone?  (to the tune of folk song "Where Have all the Flowers Gone")

 Where has Attention to Detail Gone?

Long Time Passing

Where has Attention to Detail Gone?

Financial Lit. Anyone?

Where has Attention to Detail Gone?

Get with the program everyone!

Oh When will they ever learn?

Oh When will they ever learn?

Pugly The Flying Structured Settlement Watchdog

Posted at 01:36 AM in Barco Assignments, Ltd., Financial Literacy, Liberty Mutual, Liberty Mutual Structured Settlements, Misinformation About Non Qualified Assignments, Misinformation About Structured Settlements, Richard B. Risk, Jr. | Commentary About Dick Risk and his Positions, Structured Settlement Information, Structured Settlement Services, LLC, Structured Settlement Watchdog® | | Comments (0)

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Guide to Structured Settlements 2024

  • What is a Structured Settlement? What You Need to Know
    Structured settlements and what you need to know about them including a helpful introductory video featuring A.M. Best Client Recommended Structured Settlement Expert and Registered Settlement Planner John Darer of 4structures.com LLC
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    Ways You Can Structure Your Settlement Payments in 2024. With a structured settlement you can have more than one type of payment in a single contract. Different types of structured settlement payments can be customized and combined to meet your needs on a stand-alone basis, or in conjunction with other financial products. Diversify your structured settlement, if you wish, by funding with more than one annuity issuer, with treasury funded structured settlements, index linked structured settlement payments and market based structured .
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    Structured attorney fees is a financial strategy that offers a unique way to defer taxes for lawyers and law firms. Lawyers CAN structure their legal fees even if the plaintiff doesn't structure their settlement. There are multiple ways to structure your attorney fees, such as capped or uncapped index linked structured settlement annuities where payments are adjusted based on upside changes in the S&P 500 or another index, Trial Lawyers may also use a special deferred pay/deferred compensation arrangement, if market based returns returns are desired with no cap. Plan NOW for year end! Put structured attorney fee expert John Darer® on your settlement planning team in 2024.
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  • What Are Structured Settlement Annuities?
    Structured settlement annuities are annuities that can provide one or more customized annuity payment streams in a single contract. Read about structured settlement annuities here.
  • History of Structured Settlements
    Tracing the roots of structured settlements history from 1918, when Congress exempted damages for personal injury or sickness from income tax, to the establishment of structured settlements as a core personal injury settlement planning tool to the present day.
  • What Are Market Based Structured Settlements?
    Market based structured settlements are an alternative or supplementary structured settlement solution for the plaintiff, attorney or law firm that: 1. Can afford to take some market risk 2. Have discretionary settlement dollars. Claimants and attorneys alike may find that market-based structured settlements provide the opportunity to receive tax-free income, or tax-deferred income, while enjoying growth potential.
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Qualified Settlement Funds

  • What is a Qualified Settlement Fund?
    Qualified Settlement Funds | What You Need to Know
  • Firmwide Qualified Settlement Funds Debunked
    Firmwide qualified settlement funds have been heavily promoted to trial lawyers, but have been debunked in a detailed analysis in a July 2022 legal opinion a tax partner at the law firm of Faegre Drinker Biddle & Reath, LLP. Trial lawyers and firms who have established Firmwide QSFs or coinsidering establishing a Firmwide QSF should read the analysis as part of their evaluation.

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    with a stable readership that seeks credible structured settlement information, John Darer Reviews, commentary and/or opinion about topical issues related to settlement planning, targeted to lawyers, injured persons and their family members, guardians, survivors, judges, magistrates, special masters, mediators, administrators, trust companies, insurance company executives and adjusters, financial advisers, settlement professionals, financial professionals, insurance regulators, government leaders, federal and state law enforcement, buyers and sellers of structured settlement payment rights, the news media and other interested parties. 4structures.com LLC established this structured settlement blog in 2005. John Darer ®, CLU ChFC MSSC CeFT® RSP CLTC, President of 4structures.com, located in Stamford, CT 06902. John Darer is an experienced New York City area structured settlement expert, structured settlement broker, Certified Financial Transitionist, and Registered Settlement Planner. He holds insurance licenses in 45 states, has 41 years financial services experience and 31 years in the structured settlements and settlement planning space. In his capacity as a investigative journalist and commentator, and professionally, John Darer passionately believes that shining the light on a business practice is both healthy and newsworthy. It is in the best interest of injury victims, their families and their legal advisers, that the settlement planning discussion involve those that are properly trained in the topic, properly informed on the topic and, with respect to structured settlements, properly licensed and/or appointed. It has significant instructional and deterrent value to other practitioners and firms as well as those who may be caught in the cross hairs. WHAT YOU GET here is the straight stuff with a touch of irreverence and humor. We hope you enjoy and find the content to be helpful. Subscribe to the structured settlement blog feed, or a specific category feed through your blog reader, or through the Subscribe button at the top left of this page. Followers of JDDarer™ on Twitter may also receive select content. If you would like to speak with John he can be reached at (888)325-8640 Thank you for reading! Last updated July 10, 2024

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Structured Settlement Best Practices Corner

  • New York Insurance Advertising law requires the full name of the Insurer to be listed along with the city and state of the principal office. Stating that you represent these fine companies using Insurance company logos without the preceding information are also illegal
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  • Be aware that financial advisors use of testimonials is prohibited or restricted
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Why Take a Structured Settlement?

  • A structured settlement offers guaranteed financial security to personal injury victims, wrongful death survivors and their families. A structured settlement involves a customized stream of payments, provides long-term stable tax-free income, for a period of years or a lifetime. Unlike other income annuities. a structured settlement annuity can have multiple payment streams to address multiple needs in a single contract.

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