Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary

Genex Capital Arizona Structured Settlement Investment Litigation Update

by Structured Settlement Watchdog

Time for a quick update on the Genex Capital structured settlement investment litigation in Arizona, an important case to follow for investors in structured settlement payment rights or, contemplating making investments in other people's structured settlements (or parts thereof), and their advisers.  If you are an injury victim who is evaluating whether or not to apportion your settlement recovery to a structured settlement, this article is not for you, unless your settlement planner is recommending that you invest in other people's structured settlement payment rights.

In my June 11, 2022 blog, I reported that the Court in its June 9, 2022 under advisement ruling, declined to enter a partial summary judgment in favor of Defendants against Genex Capital Corporation in its lawsuit against New England Annuity Associates, Bulbrook-Drislane, Seeley Capital Management Inc., Income Stream Funding Partners, LLC, John Bulbrook/Jane Doe Bulbrook, and Christopher Seeley (collectively, “Defendants”)

1. The Court found that Genex Capital presented sufficient evidence demonstrating that factual disputes remain as to what damages Genex may have suffered. As a result, the Court declined to enter summary judgment on the issue of damages. The Court found that Defendants have not shown an absence of any genuine issue of material fact regarding causation. Based on its conclusions, the Court declined to enter summary judgment on the issue of damages or causation of damages.

2. The Court found that the Keefer Plaintiffs are entitled to a declaration that they are the owners of and have the right to receive payments arising from the Payment Streams and that Genex has no material right, title, or interest in the Keefers’ Payment Streams.

The Court further reasoned that although the  RPA (Genex Receivables Purchase Agreement) is clear regarding the Keefers’ interest in the Payment Streams, the RPA is equally clear regarding restrictions on reassignment. Section 3.4 of the RPA states: “Buyer shall not have the right to further assign or sell the Receivable and must keep the Receivable for the balance of its term unless otherwise expressly approved by Genex.” Statement of Facts, Ex. 1, RPA § 3.4. The Court found that Genex is entitled to a declaration that the RPA does not permit reassignment of the Receivables without Genex’s consent, but denied all other relief.

Following the June 9, 2022 under advisement ruling, Genex Capital requested reinconsideration of the ruling. Subsequently the Court requested New England Annuity Associates Defendants to file a response. New England Defendants filed an amended counterclaim in July to which Genex has filed a response. 

The latest is that local counsel of record for  Genex Capital Corporation and its CEO Roger Proctor filed to withdraw as counsel.

Pursuant to Rule 5.3(a)(2)(B)(ii) of the Arizona Rules of Civil Procedure, Timothy J. Eckstein, Jeffrey B. Molinar, William D. Furnish and BriAnne N. Illich Meeds of the firm Osborn Maledon, P.A. move to withdraw as counsel of record for Genex Capital Corporation and Roger Proctor. The undersigned attorneys seek an Order granting their withdrawal on the ground that the clients failed substantially to fulfill an obligation to the lawyer regarding the lawyers’ services and has been given reasonable warning that the lawyers will withdraw unless the obligation is fulfilled.

On September 13, 2022, The Court granted the Motion of  Timothy J. Eckstein, Jeffrey B. Molinar, William D. Furnish and BriAnne N. Illich Meeds of the firm Osborn Maledon, P.A. to withraw as Counsel for Genex Capital Corporation and Roger Proctor.

GENEX CAPITAL CORPORATION, a Delaware corporation; Plaintiff,
vs.
SEELEY CAPITAL MANAGEMENT,
INC., a Massachusetts corporation; et al.,
Defendants. __________________________________

RICHARD L. KEEFER and VICKI L.
KEEFER, et al.,
Plaintiffs,
vs.
GENEX CAPITAL CORPORATION, a
Delaware corporation; et al.,
Defendants. __________________________________

AND RELATED COUNTERCLAIMS.
Case No. CV2020-004958
(Consolidated with CV2020-013796 and
CV2020-002266)

Why You Should Follow the Arizona Litigation

The Arizona litigation is perhaps the most significant case about the limitations and transactional risks of investing in structured settlement payment rights. It is well worth taking the time to understand what has happened with the investors. 

For years such receivables  (structured settlement payment rights) have been marketed to investors across the secondary and tertiary markets as if they were annuities, in some cases even insinuating, with a disclaimer, that such investors might have the same statutory protections as those who buy real annuities.  Today 37 states, who have adopted the 2017 revisons to the Life & Health Guaranty Associations Model Act (#520) have zero protection for investors in the event of the insolvency of the obligor of the factored structured settlement receivable

See Section 3A(5(c) of the 2017 Revisions tp the LIfe & Health Guaranty Associations Model Act  (#520) which expressly excludes "a person who acquires rights to receive payments through a structured settlement factoring transaction as defined in 26 U.S.C. 5891(c)(3)(A), regardless of whether the transaction occurred before or after such section became effective".

Genex Capital CEO Roger Proctor has done the structured settlement industry and consumers a substantial service in earlier responsive court filings by defining investments by the investors in this case, particularly when subject to a payment servicing agreement, as a "subset" or "the lesser subset" of payment rights.

[from 1/3/2022 Decl. of Roger Proctor in Response to Seeley Defendants' Motion for Partial Summary Judgment (at #56) IN THE SUPERIOR COURT OF THE STATE OF ARIZONA IN AND FOR THE COUNTY OF MARICOPA

GENEX CAPITAL CORPORATION, a Delaware corporation; Plaintiff, vs. SEELEY CAPITAL MANAGEMENT, INC., a Massachusetts corporation; et al., Defendants. AND RELATED COUNTERCLAIM; RICHARD L. KEEFER and VICKI L. KEEFER, husband and wife; et al., Plaintiffs,vs. GENEX CAPITAL CORPORATION, a Delaware corporation; et al., Defendants.  Case Nos: CV2020-004958 CV2020-013796 (Consolidated) at #1]

 

 

CrowFly Flies No More | Buffalo Structured Settlement Factoring Company Folds

by Structured Settlement Watchdog  (UPDATED August 26, 2022)

CrowFly, the John T. Bair principally owned structured settlement factoring origination and servicing company has played its swansong , the fat lady has sung and the curtain has come down, according to well placed sources. familiar with the situation. 

The demise of CrowFly came 4 months after a local media headline in Buffalo Business First " Fintech CrowFly hits another gear, tripling team and ramping up revenue" Buffalo Business First, Dan Miner Reporter  April 7, 2022. 

Only 4 months ago... Weird!

1. "The company’s revenue is up more than 400% annually the last two years and is in the process of nearly tripling its team to 15 employees. Co-founder Nita Bhatia was named CEO in late December (2021)"-Buffalo Business First
2. “We’re going to continue building out our org chart, which will help us continue our growth,” Bhatia said then. “We have only tapped a small portion of our potential market share and marketplace.”-Buffalo Business First
3. Huge estimated amount of daily budget in pay per click ads  

CrowFly has played its swan song

On August 25, 2022, the majority owner John T. Bair finally issued a statement "“After four years, and over a million in individual investment from me, achieving the goal of fundamentally changing the industry for the better became unviable,” Bair said"., in a post by Dan Miner of Buffalo Business First. It was unclear from the quote attribiuted to Bair if that " over a million" was before, or after, any fees earned on the sale of structured settlement payment rights from annuitants that Bair wrote while with Forge Consulting and Milestone Consulting? It's certainly reasonable to ask.

Question Of "Churning/ Attempted Churning" of Milestone and legacy Forge annuitants with structured settlement payments

CrowFly was billed as a "Fintech", part of a suite of companies in marketing materials, under the Milestone & Co umbrella  (formerly Seventh Amendment Holdings, LLC).  It really doesn't matter what they called it, there was an admission for anyone paying attention that CrowFly was a structured settlement factoring origination and servicing company.

For 4 years The Structured Settlement Watchdog, raised the natural question of whether CrowFly and other Bair associate entities targeted and mined Bair's primary market customers with structured settlement payments for structured settlement factoring.  Bair maintains however that CrowFly is a separate company despite the admission in a MIlestone Wealth's Form ADV Part 2 dated March 16, 2022 that Bair was the principal owner before the recent shuttering of the company. He also admitted in October 2018 using "we" from his Milestone email address that he was "the only primary market as well as secondary market origination firm that he knew of".

Carl Hunley Jr., a very talented artist, was commissioned to do a brand refresh for Seventh Amendment Holdings, LLC and various companies under its umbrella in 2020. As you can see from this March 28, 2020 posting on Behance, CrowFly was notably absent. I wonder why? CrowFly was in existence since 2017 and operating out of the same office.

Then came evidence found on the New York NECF IAPPS online court records system, a treasure trove of revelation.

• Our recent posts chronicle my findings. The New York court records show Seventh Amendment Holdings, LLC and United States Periodic Payment Assigment Company involvement as transferees in structured settlement transfers proposed to New York judges.  Seventh Amendment Holdings , which was renamed  Milestone & Co earlier this year, and USPPAC, are ongoing entities that participated in the factoring of John T. Bair written structured settlements.  No wonder Bair wanted a 3 year non compete and  a $100,000 liquidation of damages clause when I queried him about how he was going to manage conflict of interest in June 2018!  ( I didn't sign)
• My January 15, 2022 post discusses findings from a from New York court records search that reveal  numerous CrowFly transfer petitions, to add to the pile of petitions of the aformentioned Seventh Amendment Holdings, LLC and United States Periodic Payment Assignment Company,  the former name of holding company MIlestone & Co that was used as QSF admin and the latter a company used for qualified assignments. It would be reasonable for anyone, particularly lawyers referring cases, to question the level of "churning" of Bair written structures with all Bair related companies prior to and during CrowFly's existence. 
• What would be the result of research of court records in other states?  How many more cases would we find?  How much of the growth came from "churning" of Bair written structures?

Rising Interest Rates Hurt Factoring Companies With Thin Margins

Rising interest rates hurt structured settlement factoring originators like CrowFly. They cannot afford to get the pricing wrong on the originations, because if interest rates move up and they've priced too low to be competive, they may not be able to move the paper to investors. For example if CrowFly priced a deal at 4% and alternative investments are now paying greater than 4%, where is the room for CrowFly's margin and transaction costs?  Same thing goes for other companies. The situation grew dire for a number of firms when Sutton Park Capital, a funder of funders, reportedly turned off its funding spigot. A similar phenomenon occurred during the 2008-2009 financial crisis.  Then there were fewer splinter factions and small potatoes.

My condolences to CrowFly employees, some who find themselves out of work. It was only April 2022 when things were brimming with optimism and the company was hiring, growing to as many as 11 employees  (per Buffalo Business First]

United States Periodic Payment Assignment Company (USPPAC) Used to FACTOR Milestone Client's Structure

by Structured Settlement Watchdog

What is going on here? I thought that United States Periodic Payment Assignment Company is an assignment company, as in qualified assignments. Apparently not entirely, continued research of court records reveals!

"All in the Family"

Erie County New York Court records show that United States Periodic Payment Assignment Company (USPPAC) was used to buy structured settlement payment rights from Jerry E. Sherman, a 65 year old from Grand Island New York, a former client of Buffalo law firm Paul William Beltz PC, for pennies on the dollar in April 2017, less than two years after the structured settlement annuity was issued by John Hancock Life Insurance Company and Milestone Consulting made approximately $23,800 in commissions on the $600,000 allocated to the structure from the $2,500,000 settlement for a 1999 work related injury. Both Milestone and USPPAC have common ownership as part of a suite of companies under holding company Milestone & Co, LLC  (f/k/a  Seventh Amendment Holdings, LLC.  The holding company shares are primarily owned by John T. Bair, according to the March 16, 2022 Form ADV Part 2 filing by another subsidiary of MIlestone & CO, Milestone Wealth, LLC.

In the Amended Petition dated May 9, 2017 at #3, In the Matter of the Petition of United States Periodic Payment Assignment Company for the Approval of Transfer if Structured Settlement Payment Rights In Accordance with GOL  5-1701, Petitioner vs Jerry E. Sherman, John Hancock Assignment Company and John Hancock Life Insurance Company of New York, Respondents  Supreme Court of the State of New York Erie County  Index 804461/2017, submitted by Bernadette Weaver-Catalana, Esq, of Lavin, O'Neil, Cedrone & DiSipio, attorneys for USPPAC, it is represented that USPPAC (the Petitioner) is a " transferee" as defined in GOL 5-17021(t), which states  "transferee” means a party acquiring or proposing to acquire structured settlement payment rights through a transfer or restructuring.

In Delaware, USPPAC's state of domicile, the term "transferee" means a party acquiring or proposing to acquire structured settlement payment rights through a transfer.   

Who Reviewed The Documents Submitted to the Court?  Even the Amended Documents Raise Questions

The "Fund Settlement Agreement" states the agreement was entered into on March 16, 2015, but the parties to the agreement signed on prior dates, Jerry E. Sherman. on March 2, 2015 and the Sherman QSF Adminstrator David J. Reino, signed on March 7, 2015. ( Fund Settlement Agreement page 1 and 4)

Section 8 of the Amended Petition date May 9, 2017 raises some questions about alleged facts, stating that "the Defendant's insurer subsequently assigned its obligation to John Hancock Assignment Company", when the Qualified Assignment and Release, dated April 30, 2015, lists the Assignor as the Sherman Qualified Settlement Fund. Think 1.468B-1(C)(2), the so-called  "resolve or satisfy" requirment, a very basic fundamental of QSFs. The QSF must be established to resolve or satisfy one or more contested or uncontested claims that have resulted or may result from an event (or related series of events) that has occurred and that has given rise to at least one claim asserting liability. The Defendant would have already received a General Release when the QSF was funded .

The Periodic Payments Payment under the March 16, 2015 Fund Settlement Agreement and in the issued John Hancock annuity contract of June 11, 2015. show a payment start date of April 1, 2012.[ Sherman QSF Fund Settlement Agreement Article 3, Section 3.1.2 below]

Does anyone need to fire up the DeLorean (left) ?  The paperwork for the Establishment of the QSF was not attached to the Court record. One possible explanation (and this aspect is speculation on my part) that the QSF was established at or about the time the Sherman v Hervert C. Hales case (Erie Counnty Index 0005837/1999) was settled by pre-trial stipulation on  April 12, 2011 in front of Hon John  M. Curran. The QSF was subsequently funded in February 2012, or earlier, given the date of February 20, 2012 on the John Hancock application that bears Bair's signature. Is it possible that David J. Reino, the Administrator of the Sherman QSF agreed to advance fund the Sherman structure to protect the rates?

Copy of Fund Settlement Agreement 3-16-2015

Download 804461_2017_United_States_Periodic_v_United_States_Periodic_EXHIBIT_S__Sherman QSF Fund settlement agreement 3-16-2015

Copy of signed Qualified Assignment and Release

Download 804461_2017_United_States_Periodic_v_United_States_Periodic_EXHIBIT_S__3 QAR eff. 4-30-2015

Copy of John Hancock Life Insurance Company of New York annuity with application signed by John T. Bair,  Conclusive evidence that Bair write the Sherman annuity and together with the court filed papers in this case, present yet another example that Bair and/or companies Bair owned or controlled, engaged in factoring cases he wrote.

Download 804461_2017_United_States_Periodic_v_United_States_Periodic_EXHIBIT_S__4 Copy of JH annuity John Bair xd app

As the examples continue to present themselves in New York court records where a transaction was initiated by CrowFly, Seventh Amendment Holdings  (now MIlestone & Co, LLC) or USPPAC, one naturally wonders whether there was an active campaign to mine and market factoring services to individuals who are, or were receiving periodic payments from a structured settlement brokered by Bair/Milestone Consulting (2012-present) or Bair/Forge Consulting  (pre-2012). I've written about Bair/Milestone's mass communication to trial lawyers in April 2020, to get their clients out of annuities. 

Upon information and belief Milestone Consulting withdrew its structured settlement annuity appointments with insurers issuing structured settlement annuities in or around early June 2022.

 

3 Bair Related Entities in Coordinated Attempt to Factor Structure Written by Bair, Court Records Show

by Structured Settlement Watchdog

Milestone Related Factoring Life BEFORE the Crow Flew

The Great Dane-ish Watchdog

In a prior post of January 15, 2022, I brought readers' attention to a significant number of cases found in New York court records, where CrowFly, LLC, a self-described structured settlement transfer of payments originator and servicer of court approved structured settlement transfers, of which John T. Bair is the Managing Member and a principal owner (Source: Milestone Wealth Form ADV Part 2 Item 10, March 16, 2022), factored structured settlements placed by Mr. Bair. 

It has since been discovered that long before establishment and active promotion of CrowFly, LLC, the structured settlement factoring origination firm and servicer in 2017 and joining the National Association of Settlement Purchasers in 2022, irrefutable evidence found in New York court records indicates that Milestone CEO John T. Bair displaying, used THREE RELATED ENTITIES to engage in the purchase (and/or attempts to purchase) MORE structured settlement payment rights from , clients sourced from the nation's trial lawyers at the same time he and/or Milestone maintained an insurance license and appointments with most structured settlement annuity issuers and placed similar annuitants into structured settlement annuities. 

The Virgilio Case  |  Structured Settlement Established by Bair with MetLife in 2005 

In 2005, John T. Bair was President and CEO of Forge Consulting, LLC. In one full page ad in the middle 2000s that was published in a state trial lawyers' publication which emphasized how much money his firm gave to the American Trial Lawyers Association (now AAJ), it's notable that buried in the ad is the statement that " Structured settlements provide the security that no lump sum can".

In 2005, John T Bair/Forge Consulting placed a structured settlement  for Joseph N. Virgilio as part of the compensation for a wrongful death settlement. The structured settlement was funded with a structured settlement annuity issued by Metropolitan LIfe Insurance Company bearing MetLife certificate number 86291FOR.  

As the result of the settlement of a claim against Wyeth Pharmaceuticals et al, the structured settlement was to pay Virgilio $11,250 per quarter, guaranteed for 10 years, beginning September 15, 2015, with a final quarterly payment due on June 15, 2015 of $1,000,000.00

The Virgilio Proposed Sale and Proposed Purchase by Seventh Amendment Holdings, LLC in June 2015

Astounding and notable is the "spaghetti junction" of related parties and no independent professional advice:

1. Seventh Amendment Foldings, LLC  (as of 1/11/2022 MIlestone & Co, LLC), the holding company for two other involved Bair related companies was to be the originating purchaser of Virgilio's structured settlement payment rights
2. United States Periodic Payment Assignment Company (USPPAC) is an assignment company under the Seventh Amendment Holdings, LLC umbrella and it was to take part in the transaction. United States Periodic Payment Assignment Company (USPPAC)  "is an independent assignment company formed in accordance with Section 18-201 of the Limited Liability Company Act of the State of Delaware", according to Milestone's marketing materials. 
3. Milestone Consulting, LLC, another company under the Seventh Amendment Holdings umbrella, a company in which Bair was CEO at the time was selected by Virgilio to represent him according to the June 14, 2015 Structured Annuity Purchase Agreement with Seventh Amendment Holdings, LLC that it entered into with Virgilio. It's obvious that Virgilio did not prepare the document. Virgilio waived independent professional advice according to the filed documents. An admission that Milestone's advice was not independent?  Who submitted that to the court?  Read on.

• On June 15, 2015 Seventh Amendment Holdings, LLC submitted a petition to the New York State Supreme Court in Erie County  (Index 807286/2015)  in a matter captioned  " In the Matter of Seventh Amendment Holdings, LLC for Judicial Approval of the Sale and transfer of Structured Settlement Payment Rights", to buy the $1,000,000 lump sum from Mr. Virgilio in a sale and assignment of structured settlement payment rights. 
• Seventh Amendment Holdings LLC was to pay Virgilio $300,000 in cash (SAH would receive the $1,000,000 transferred from MetLife instead of Virgilio) together a fresh monthly payment stream for another 10 years in approximately the amount of $7,090.10 each, guaranteed by Seventh Amendment Holdings for 10 years, beginning January 15, 2016. The terms of the deal as stated in the petition include "that the final monthly benefit amount will be predicated and finalized based on pricing available in the market at the time of puchase".
• using a combination of annuities and serviced structured settlement factoring payment streams  (the latter from the structured settlement secondary market- servicing would not be necessary if it was a legitimate stuctured settlement annuity).
• The Petition includes the  sworn statement of John Bair acting in the capacity as President of Seventh Amendment Holdings, LLC, dated June 15, 2015, that he read the Verified Petition, knows the contents thereof; and that the same is true to his own knowledge with the exception of what is denoted as upon information and belief.
• At all relevant times, Bair's Milestone Consulting was appointed with Metropolitan Life Insurance Company as an agency for the placement of structured settlement annuities.

The Virgilio Petition

Download 807286_2015_In_the_Matter_of_the_P_v_In_the_Matter_of_the_P_PETITION_1. 

The Virgilio Affidavit

Download 807286_2015_In_the_Matter_of_the_P_v_In_the_Matter_of_the_P_EXHIBIT_S__9,

The Virgilio Structured Annuity Payment Purchase Agreement

Download 807286_2015_In_the_Matter_of_the_P_v_In_the_Matter_of_the_P_EXHIBIT_S__7 Structured Annuity Agreement

Can the Proceeds of a Structured Settlement Factoring Transaction be Used for a New Tax-Free Payment Stream?

For the Payee

From a tax perspective, this shouldn't affect the Payee. The payments received will still be made on the account of the physical injury. See IRS PLR  200918001. 

For United States Periodic Payment Assignment Company  (USPPAC)

But there's some concern that USPPAC would have significant and unexpected  tax liability.  Normally, in a qualified assigment, the assignment company doesn't owe any tax on the amount it receives and uses to buy an annuity. IRC Section 130.  But here, the payment to be received by USPPAC isn't being used to buy an annuity. And the trarnsaction might not be treated as a "qualified assignment". That's because Seventh Amendment Holdings is assuming the liability from a party that probably wasn't  "a  person who is a party to the suit or agreement as required by IRC 130(1).  I.R.C. To wit...§ 130 (c) (1) — if the assignee assumes such liability from a person who is a party to the suit or agreement, or the workmen's compensation claim

The above doesn't matter if United States Periodic Payment Assignment Company (USPPAC) was a foreign assignment company, But is it?  It's a Domestic Limited Liability Company in the State of Delaware, according to Milestone's own marketing materials. 

At the time of the Petition Bair had been in the structured settlement field for an estimated 17 years, yet the Petition includes the statement that 26 USC Section 103 is relevant to Met Life's responsibility to make payments provided for under the structured settlement that Seventh Amendment was seeking to purchase. [ Virgilio Petition #8] I happen to know that Bair is a pretty good golfer and won a longest drive contest or two, so it would not be apt to say it is "par for the course" but the fact remains that 26 U.S. Code § 103 refers to Interest on State and local bonds and is irrelevant as neither state and local bonds is an annuity or a serviced factored structured settlement payment right or a qualified funding asset.

To the extent that Virgilio's replacement payments are funded with factored structured settlement receivables (other people's structured settlement payments), he may not have any protection in the event the annuity issuer goes insolvent.  37 states, including Virgilio's resident state of Illinois leave investors S.O.L. in the event of insolvency following the state's adoption of the 2017 Revisions to the LIfe & Health Guaranty Association Model Act (#520).  There's no grandfathering, the changes are retroactive upon the effective date of adoption by the state. 

Who is Seventh Amendment Holdings, LLC

Before it was renamed recently, Seventh Amendment Holdings (SAH) was self-described" in MIlestone promotional materials as a suite of companies designed to provide guidance and support to plaintiffs and attorneys before, during, and after litigation". Through a range of entities that include a 501(c)(3) nonprofit organization, a settlement planning and consulting firm, a wealth management firm, and a financial tech start-up, SAH has said it is deeply committed to finding and providing the best financial solutions for individuals and families dealing with tragedy.  Seventh Amendment Holdings LLC is a limited liability company (LLC) located at 737 Main St Ste 100 in Buffalo, New York   Source: Cision Press Release attributed to Milestone  October 21, 2021. Seventh Amendment Holdings, LLC was renamed Milestone & Co, Inc, effective April 1, 2022.  Source: Open Corporates  [ OpenGovus says the renaming was January 11, 2022, but who's counting?]

Who Owns Milestone & Co, LLC (f/k/a Seventh Amendment Holdings)

The INvestment Adviser Public Disclosure for Milestone Wealth, LLC  (f/k/a Monolith Advisors), states it is a registered investment adviser based in Buffalo, NY.  Milestone has been offering advisory services since 2013. Milestone & Co., LLC is the sole owner of the firm. John Theodore Bair  (John T. Bair) is the President and Chief Compliance Officer of the firm and the primary owner of Milestone & Co., LLC, according to the firm's most recent Form ADV Part 2, filed in March 2022.  Source: Investment AFdviser Public Disclosure  (IAPD)

Who Owns Crowfly, LLC, Bair's Current In House Structured Settlement Factoring Firm?

Bair is the majority owner of CrowFly, LLC according to the March 16, 2022 update of the Milestone Wealth Form Adv Part 2

In addition to his responsibilities at Milestone, WEalth John T. Bair is the President and Chief Executive Officer of Milestone Consulting, LLC (“Milestone”), a consulting firm and insurance agency located in Buffalo, New York. A part of its services, Milestone provides clients with consultations regarding the appropriate investment options for court settlements resulting from personal injury and wrongful death lawsuits. Mr. Bair devotes approximately 60% of his time to his activities at Milestone and is directly compensated as an officer and employee of Milestone for his services.  Ibid.

John T. Bair is the Managing Member and a principal owner Crowfly, LLC a structured settlement transfer of payments originator and servicer of court approved structured settlement transfers. Crowfly, LLC has developed an online platform directly connecting the sellers of annuities with qualified buyers. Occasionally, a seller of an annuity may invest the proceeds of the sale with Milestone. Additionally, in some instances, when a Milestone client is in need of a more secure income stream, Milestone may recommend an annuity that is listed through CrowFly to the client.  Bair/Milestone admits in the Form ADV part 2, that these activities trigger a conflict of interest because Crowfly receives compensation for the transaction. Clients to whom the firm offers advisory services are informed that they are under no obligation to purchase annuities from Crowfly, LLC and may use the annuity brokerage firm of their choice. Client should also note that annuity guarantees are subject to the claims-paying ability of the issuing insurance company.  Ibid.

The only thing is that factored structured settlement payments treams offered by CrowFly are not annuities. For example, under New York law, where Milestone & Co  (Seventh Amendment Holdings) and CrowFly's main office is, "an annuity is a contract between a purchaser and an insurance company in which the purchaser agrees to make a lump sum payment or series of payments in return for regular disbursements, beginning either immediately (within 12 months) or at some future date"  Source:  New York Department of Financial Services"

 

 

Symetra Hit With Class Certification In Structured Settlement Lawsuit Over Affiliate Factoring Operation

by Structured Settlement Watchdog

Seattle based Symetra Life Insurance Company Slammed with Structured Settlement Class Action Certification

A nationwide class action lawsuit certified against Symetra Life Insurance and its affiliate Symetra Assigned Benefits Service Company (“SABSCO”) alleges that Symetra and its affiliate violated RICO, the Washington Consumer Protection Act, civil conspiracy, unjust enrichment, and their contractual rights. In her August 3, 2022 order, Judge Marsha J. Pechman of the United States District Court for the Western District of Washington granted class certification in White, et al. v. Symetra Assigned Benefits Service Company, et al. United States District Court Western District of Washington
Case No. 20-cv-01866 and certified the following class:

“All persons who are or were, at any time:

1. annuitants of [a structured settlement annuity (“SSA”)] that contemplated life contingent payments issued by Symetra AND
2. who subsequently sold to a Symetra affiliate the right to receive payments from that SSA in a factoring transaction.”

The Court denied Plaintiffs’ Motion to Certify a Class as to their breach of fiduciary duty claims.

Plaintiffs brought this class action lawsuit on behalf of themselves and all others who, in settling underlying tort litigation, became the beneficiaries of a Symetra Life Insurance structured settlement annuity, and who then sold the rights to their future annuity payments to SABSCO or another Symetra affiliate.

Symetra Used Position of Trust

Plaintiffs’ amended complaint seeks redress for injured persons and families who relied on Symetra to safeguard their loing-term financial well being , alleging that Symetra Defendants solicited Plaintiffs’ rights to their future payments as part of a business scheme that used their position of trust as issuer and owner of Plaintiffs’ structured settlement annuities. Plaintiffs allege that Defendants leveraged their knowledge and unequal bargaining power to profit by purchasing Plaintiffs’ future payments at a steep discount in factoring transactions. As a certified class, Plaintiffs are one step closer to holding Symetra Defendants accountable for these practices.

Read August 3, 2022 Order Approving Class Certification in White v Symetra Life Insurance Company SABSCO 8-3-2022

The Responsibilty of Settlement Planners and Plaintiff Structured Settlement Brokers in Symetra placements 2006-2012

I Told You So About Symetra and Clearscape in 2006, 2007, 2008, 2009, 2010... Did Your Settlement Planner?"

Symetra's factoring operation was well known in the structured settlement industry from at least January 2006 until Symetra stopped writing structured settlement annuities in 2012.

Symetra was pressured to resign from the National Structured Settlements Trade Association  (NSSTA) as its factoring activity was incompatable with the mission of NSSTA.  To be clear, Symetra actually established a factoring company called Clearscape Funding and solicited not only Symetra (and former SAFECO) annuitants, but externally as well. 

I personally sent a strongly worded letter to Symetra on January 23, 2008 withdrawing my appointment in disgust  (see Writing on the Wall below entry for January 23, 2008).  I cannot say the same for other settlement planners who, despite public knowledge of the existence of Clearscape and what Symetra was doing, continued to place business with Symetra.  

• How many of these settlement planners "romanced" trial lawyers with lavish donations to state and local trial lawyer associations, who turned the other cheek to recommendations and proposals to place business with a lower rate company that had a known factoring company?
• How many settlement planners' put their clients into Symetra structured settlement annuities out of a single claimant QSF, despite advanced knowledge of Symetra's factoring operation?
• How many times did settlement planners' often belicose and bombastic rhetoric about dastardly approved lists led to a Symetra structured settlement annuity placement?
• How many settlement planners continued to make recommendations, to trial lawyers and their clients, to place their hard fought for settlement dollars into Symetra, DESPITE knowing of the existence of Clearscape?
• How many settlement planners solicited customers using the false statement that Symetra was a "Berkshire Hathaway Company" to "do-si-do" the known Clearscape issue?

Will the Symetra Structured Settlement Class Action bring a reckoning to Symetra and shine the light on those who placed their clients in harm's way? 

The Writing was on the Wall

• May 26, 2010   "If You Don't Use Clearscape You're Lump Sum Will Be Taxable"
• May 5, 2010  Puffery The Magic Dragon
• May 5, 2010  Structured Settlement Accounting and Insurer Investment Challenges on Long Tail Liabilities
• March 25, 2010 Symetra Structured Settlement Annuitant Has Concerns About Symetra Postcards That Solicit Cash Now
• January 28, 2008  Symetra "Hard Sell" v Allstate " AFEN"
• January 23, 2008  Symetra Doesn't Really Want to Be in the Structured Settlement Business Do They?
• October 29, 2007 Letter from Jesper Hansen, a Sales Specialist from Symetra to Los Angeles couple regarding SABSCO buying
• August 10, 2006  My "Rights" to be a Spendswift?
• April 19, 2006   Symetra Be Clear About Clearscape! 
• January 14, 2006  Boo Symetra and Boo Hoo Too

 

 

 

 

Sell Your Structured Settlement for Pennies on the Dollar in Time for The Holidays? Don't Fall For It!

by Structured Settlement Watchdog

What is perhaps one of the dumbest and cheesiest ideas that you may encounter if you're receiving structured settlement payments is the idea that you should sell your structured settlement payments (for pennies on the dollar), to have money to buy holiday gifts.

Sell Your Structured Settlement Payments in Time for the Holidays?

"People are experiencing financial uncertainty due to current inflation and might struggle to catch up on monthly expenses. Even though holidays are so far away, they are approaching and with them, expenses rise significantly".  July 14, 2022 solicitation tweeted out by structured settlement payment purchaser. 

Say you wanted to raise $1,000 for holiday gifts, when you factor in the court filing fees, legal fees and buyer's profit margins, you're always going to lose money, possibly multiple times what seek to get out for holiday money.

Chronovo Could be Promoting Annuities Using Red Sox Legend Instead of Bobby Bonilla, NY Mets Madoff Misery

by Structured Settlement Watchdog

Chronovo, which is  based in a suburb of Boston Massachusetts continues to promote annuities using "Bobby Bonilla Day", a “holiday” of sorts celebrated by baseball fans, who use memes and jokes to talk about how the New York Mets pay someone who hasn’t been on the field since 2001 over a million dollars every year until 2035 when there are far better and more relevant choices to illustrate the value of annuities using other baseball players and other sports figures.

The Gratuitous Trivialization of Madoff to Promote Annuities

Why would a rerun of "Creepend at Bernies" be deemed essential to Chronovo to promote the value of annuities, specifically structured settlement annuities?  Bernie Madoff's fraud was the 2nd biggest in US History. Having a value proposition that is NOT gratuitously intertwined with a Bernie Madoff victim would be more approriate. For back story see Madoff Investment Scandal and how it hit former Mets Principal Owner Fred Wilpon 

Unfortunately, but not unsurprisingly, this seems to have been lost on Chronovo, which highlighted the Madoff connection in its most recent Chronovo Chronicle celebrating Bobby Bonilla Day. At least the lack of depth perception stopped short of trivializing Joey Gargan, another convicted felon, a former structured settlement broker and company owner and "Kennedy connection", who remains incarcerated at FMC Butner, where Bernie drew his last breath in April 2021.

There's Nothing Unusual About Deferred Payments to Athletes But There Are Much Better Examples

There's nothing unusual about a team paying athletes deferred annuity payments, but Bobby Bonilla is no Ken Griffey, Jr. or
Manny Ramirez, both of whom have bigger annuities and arguably had greater career accomplishments, by quite some distance. In my opinion Griffey Jr and Manny Ramirez in particular are better examples to promote annuities for any company, let alone, a company from Boston.

I'm a lifelong New York Yankees fan, but in this case, since we're discussing annuities, I'm waxing lyrical about a Red Sox legend in an effort to change the narrative of certain annuity promoters' (at least structured settlement annuity promoters) narrative from Bobby Bonilla to other athletes who had better careers and more significant annuities. 

Manny Ramirez  was a Boston Red Sox and Major League baseball legend and 12 Time All Star.  Manny was a complete hitter, who hit for both power and average, and recognized as one of the best right-handed hitters of his generation, Ramirez finished his career with a lifetime .312 batting average, 555 home runs (15th all-time), and 1,831 RBI (18th all-time). In 111 postseason games, Ramirez posted a .285 batting average with 29 home runs and 78 RBI in being on 2 World Series winning teams.

Ken Griffey Jr.

Griffey Jr.  630 HR,  .284 BA,  1836 RBI,  184 SB, .538 SLG   Griffey, Jr. is a Hall of Famer,  a thirteen-time All-Star and one of the most prolific home run hitetrs in baseball history, 7th in MLB history. Griffey  won ten Gold Gloves as a center fielder and tied for the record of most consecutive games with a home run (eight, with Don Mattingly and Dale Long. He's been on the cover of the box of more than one variety of Wheaties for goodness sakes!

The Manny Ramirez Annuity

Manny Ramirez signed a $160M contract with the Boston Red Sox in 2008, with deferred $1.968MM/year increasing at 0.25% from  2011-2026 (16 payments) Total annuity payout $30,077,936. Here is the schedule: 

2011 — $1,968,677   2012 — $1,973,599  2013 — $1,978,533   2014 — $1,983,479  2015 — $1,988,438  2016 — $1,993,409

2017 — $1,998,393   2018 — $2,003,389  2019 — $2,008,397   2020 — $2,013,418  2021 — $2,018,452  2022 — $2,023,498

2023 — $2,028,557   2024 — $2,033,628  2025 — $2,038,712   2026 — $2,043,809  Source: Boston.com

 

Just in case you were wondering, says Chronovo, the total payout to Bobby Bonilla at the end of this road in 2035 will be $29,831,205.00.  Ouch!

 

Funnily enough, in a 2020 article Sportscasting.com reported that Red Sox Will Keep Paying Manny Ramirez Until He Turns 54

The Ken Griffey Jr. Annuity

Griffey, Jr. has even been on a Wheaties Box

Ken Griffey, Jr.  $112M contract deferred $3.59MM/year from 2009-2024. Despite being retired and not playing for the Reds since 2008,  the 13 Time All Star Hall of Fame slugger Ken Griffey Jr. is the 6th highest-paid players on the Cincinnati Reds.  Total Deferred Payout $57,440,000

Just to remind you in case you were wondering, the total payout to Bobby Bonilla at the end of this road in 2035 will be $29,831,205.00. Ouch!

Better Career Stats than Bonilla, Better Annuity than Bonilla

Ken Griffey, Jr.  $112M contract deferred $3.59MM/year from 2009-2024. Despite being retired and not playing for the Reds since 2008, Hall of Fame slugger Ken Griffey Jr. is the 6th highest-paid players on the Cincinnati Reds. 

Bonilla       287 HR   .287 BA    1173  RBI   48 SB     .472 SLG  6 Time All Star, One time time World Series winner (with the 1997 Florida Marlins)

While a quality player, Bonilla's career stats performed well below Manny Ramirez and Ken Griffey Jr,  his peers with deferred payments

Bobby Bonilla himself was quoted in the New York Post on July 1, 2022 as saying "“I’m probably more famous for that deal than the career I had” 

But for the fact the Mets and its owner were scammed by the late crooked Bernie Madoff, there would be no Bobby Bonilla Day.  Instead of "celebrating" Bonilla, perhaps Chronovo should reconsider their post given Bonilla's deferred compensation peers as a better role model for annuities. Madoff was a crook who destroyed lives and died a miserable death. 

One of the more significant and impactful parts of the July 1, 2022 New York Post article was the statement that Bonilla has never approached the Mets about receiving the funds all at once, instead opting to keep the yearly tradition going.  “I’ve never even thought about it,” Bonilla said.   This statement IS something to get in front of young people of color with structured settlements who are targeted by structured settlement factoring companies when they reach 18 and throughout their 20s. 

Think  "Just Say No. Like Bobby Bo"

Related Reading

Annuity.org Revives Tired "Bobby Bonilla Day" for the Ides of March. Why?

 

Vintage Equity Group in Daft Attempted Pluck of Peachtree Structured Settlement Factoring Petitions in CA/CT/NJ/NY

by Structured Settlement Watchdog

"Plucking Hell!"

Vintage Equity Group's recent effort to hijack multiple pending Peachtree structured settlement factoring petitions deserves mention here for risible high grade daftness. If you're a legislator or disability advocate in CA, CT, NJ, NY, or a reader who knows someone who is, perhaps one should alert them to this post as a small, but potent example of the relentless and aggressive ways structured settlement annuitants may be approached to sell their payments in 2022.

1. The Glenn Davis Solicitation Letter

Glenn Davis is a Chula Vista, California resident with a pending Peachtree petition with an upcoming hearing date according to online public records available through the California Superior Court. Davis is receiving payments from a structured settlement with Metropolitan Tower Life Insurance Company.

Davis recently received a solicitation from 1201 North Market Street Suite 111, Wilmington, DE 19801  ( a Virtual Office Address) that was held out as " Notice of Payment Revision Option : Conversion #363487

The Subject line of the solicitation was " Metropolitan Tower Life Insurance Company Payment Adjustment Options"

Dear Glenn,

"...I wanted to reach out and see if you had any interest in accelerating a tax-free lump sum out of your annuity. Per our records you still have payments remaining on your policy":

Stream: $1,147.06 for life, payable monthly, guaranteed for 25 year(s). Payments starting on 04/15/2021, with the last guaranteed payment on 03/15/2046.

Rather than waiting on the full extent of deferred interest within the policy, I have listed 3 amounts below that you are eligible for depending on the structured settlement payment adjustment that we can discuss together in further detail. Keep in mind, these values  simply provide a general framework of what we can accomplish, and it can always be tweaked or restructured to meet your specific financial needs.

Term 1  $50,314.72  Term 2: $25,201.26   Term 3 $10,337.57  Term 4 $101,826.32

1. Selling 2021 payments in 2022?
2. Didn't they say 3 amounts?  4 were displayed. Vintage Equity Group displays the same lack of attention to detail on letters to different people on opposite sides of the country!
3. The Term amounts are the same for the two letters with addresses on opposite sides of the country.
4. Selling structured settlement payments for pennies on the dollar is not a "paymant adjustment option". 
5. Selling structured settlement payments for pennies on the dollar is not a "payment revision option".
6. Offering to buy structured settlement payments  is not a payment adjustment
7. Offering to buy structured settlement payments is not a payment revision
8. Offering to buy structured settlement is not an "acceleration of a tax free lump sum". It is a purchase of structured settlement payments for pennies on the dollar.
9. Kevin Richards, the purported signatory of the letter to Glenn Richards, is not a real person, according to a representative of Vintage Equity Group I spoke with last week. 
10. The address on the letter is an Opus Virtual office address in Wilmington Delaware.
11. Deceptful suggestion that somehow Metropolitan Tower Life is involved in this daftness (they aren't). Vintage Equity Group is not connected to Metropoliatn Tower Life.

2. The Agosto Solicitation Letter

Nelson Agosto is a Connecticut resident with a pending Peachtree structured settlement transfer petition in Waterbury, with an upcoming hearing date in August 2022, according to online public records available through the State of CT Superior Court  Docket UWY-CV-22-6066197-S.

Agosto is receiving payments from a structured settlement with Pacific Life Insurance Company.

Agosto recently received a solicitation from 1201 North Market Street Suite 111, Wilmington, DE 19801 held out as " Notice of Payment Revision Option : Conversion #363506

The Subject line of the Nelson Agosto solicitation was " Pacific Life Insur Co Payment Adjustment Options"

Dear Nelson,

"...I wanted to reach out and see if you had any interest in accelerating a tax-free lump sum out of your annuity. Per our records you still have payments remaining on your policy":

Stream: **PAYMENTS REDACTED FROM PRIOR TRANSACTION

Rather than waiting on the full extent of deferred interest within the policy, I have listed 3 amounts below that you are eligible for depending on the structured settlement payment adjustment that we can discuss together in further detail. Keep inmind, these values  simply provide a general framework of what we can accomplish

Term 1  $50,314.72  Term 2: $25,201.26   Term 3 $10,337.57  Term 4 $101,826.32"

Commentary

1. Didn't they say 3 amounts?  4 are displayed. Vintage Equity Group displays the same lack of attention to detail on letters to different people on opposite sides of the country!
2. The Term amounts on Nelson Agosto solicitation were the same as were in the letter received by Glenn Davis, while the addresses were on opposite sides of the country.
3. If the payments were redacted then how did Vintage Equity Group come up wih the 4 different terms?
4. With a smidgen of effort I was able to find the Peachtree petition on the Waterbury CT docket cited above. The petition seeks approval of proposed sale of $35,110.20 in aggregate for $5,020.00. Payments being sold and subject to an August 1, 2022 hearing, span 5 years from February 9, 2028 and single lump sum on February 2, 2033. Peachtree's offer bears a 24.61% discount rate
5. That would be some deal to be able to take Agosto's Term 4 from the Vintage Equity Group solicitation and get almost 3 times the aggregate payments, or Term 1 and get almost 1.5 times!  Is there a business reason that the would-be hijackers seek to create a loss, or is it simply the case of someone's a bonehead?  
6. Selling structured settlement payments for pennies on the dollar is not a "paymant adjustment option". 
7. Selling structured settlement payments for pennies on the dollar is not a "payment revision option".
8. Offering to buy structured settlement payments for pennies on the dollar is not a payment adjustment
9. Offering to buy structured settlement payments for pennies on the dollar is not a payment revision or payment revison option.
10. Offering to buy structured settlement poaymnets for pennies on the dollar is not an "acceleration of a tax free lump sum". It is a purchase of structured settlement payments for pennies on the dollar.
11. Deceptful suggestion that somehow Pacific Life Insurance Company is involved in this daftness (they aren't). Vintage Equity Group is not connected to Pacific Life Insurance Company or its New York subsidiary.
12. Kevin Richards, the purported Payment Revision Director and signatory of the letter to Nelson Agosto, is not a real person, according to a representative of Vintage Equity Group I spoke with. Vintage Equity Group is thus soliciting consuemrs with a fake person with a fake title. Pathetic.
13. The address used on the solicitation to both Glenn Richards and Nelson Agosto was Opus virtual office center in Wilmington Delaware.

3. The Donyell Solicitation

Hi Donyell, my name is Fred Harrison and  I have been assigned to your structured settlement case out of the Sussex County (NJ) Courthouse. The case has been referred to me, it has been recommended that you seek a reevaluation of your current transaction. It is more than likely you are not receiving the actual current value “ACV” of your payments which would put this transaction at a very high risk of being denied in court. If your transaction has already been settled regardless of it being approved, denied, or rescheduled, please give us a call to discuss some of the options you may have. This may include a rebate program that would allow you to receive money back from a previously completed transaction. Thank you (888) 233-4567.”

Commentary

1. Assigned by whom, the Sussex County NJ Superior Court?
2. "Fred Harrison" is believed to be a fictitious name
3. Who has recommended that you seek a re-evaluation?
4. Transfers of structured settlements payment rights are not settlements.
5. Rebate from a previous transaction is nonsense, It's likely a fraudulent inducement. Suggests that Company A ( that did a prior deal will pay back some of the profits they earned, today. See if the new company, Company B is going to make that up by getting you to sell more payments for more pennies on the dollar. No buyer of structured settlement payment rights is going to pay more than pennies on the dollar under the best of circumstances. With rising interest rates and companies like Sutton Park and DRB apparantly not having an appetite to buy from brokers, the factoring broker buyers have to price their deals right if they are going to be able lay off the receivable to an investor.
6. (888)233-4567 is a non-working number.

4. The Queens New York Solicitation (NEW)

Different Day, same M.O, same B.S. from "Fictitious Frank", that's " Frank Harrison", this time used in a solicitation to a Queens New York man who had been working with Peachtree. Received a call from the annuitant 8/8/2022.

Vintage Equity Group Misrepresentations to Consumers on its Website

Vintage Equity Misrepresentation #1

"Structured settlements can appear from a personal injury lawsuit most of the time. In this situation, the
person agrees to receive periodic payments over time instead of a specific sum shared right off the bat".

Comment

Structured settlements are a negotiated stream or streams of future periodic payments that form part of the consideration for the settement of a claim or lawsuit. A structured settlements is not a "mirage" that appears on a hazy desert horizon and is  wholly dissimilar to a phantasm of late Aunt Millie knitting a spider web on the couch in the twilight.

Vintage Equity Mispresentation #2

"The best part about selling your structured settlements is that you get to receive a single sum so you can
pay for all your needs on the spot. You won’t have to wait for each month’s allocated sum. Instead, we
take care of that and you receive all your money right away. It’s the best possible option you can focus
on, and it will provide you with a tremendous return on investment this way".

Commentary

What Vintage Equity Group says is a multi faceted mirsrepresentation because (1) when you start the process of selling your structured settlement payment rights you won't get your money on the spot. It could take 30, 60, 90 days or more. Indeed all Vintage Equity will give you is an advance of $1,000 (If you qualify); (2) the Vintage Equity Group lie that you will receive all your money right away. If you sell your payments you will NEVER receive ALL your money. The most Vintage Equity Group (or any other structured settlement factoring company will pay for your structured settlement payment rights is pennies on the dollar; (3)the Vintage Equity statement that "it's the best return on your investment" is an unprovable false claim that seems inebriated in snake oil.

Several calls were made to Vintage Equity Group ( "VEG") as part of my investigation. On only one occasion a person named George picked up the phone and kept me on hold for 11 minutes.  It does not inspire much faith that nobody has a last name.  The address listed on the Vintage Equity Group website is yet another Opus Virtual Office . 913 N Market St Ste 200, Wilmington, DE 19801 - YP.com (yellowpages.com). Nevertheless, I learned that the company is comprised by alumni of Seneca One Finance and US Annuity Services. 

Seneca One

The now defunct entity was known for conjuring up fake but somewhat real sounding associations or agencies like the "National Structured Settlement Registry" as a scheme to phish for leads to people who had structured settlements.

Sometimes you should just leave the "VEG-gies" on the plate.

Which Structured Annuity Issuers Are Among A. M. Best 2022 List of Largest Insurers?

by John Darer CLU ChFC MSSC CeFT RSP CLTC

Insurance groups that include current and former structured settlement annuity issuers represent more than 43% of the largest life insurance groups in the United States.

• Prudential  (1)
• MetLife (2)
• New York Life(3)
• Massachusetts Mutual Life (4,  former structured settlement annuity issuer)
• AIG Life & Retirement  (6, soon to be Corebridge Financial)
• Lincoln Financial (8, acquired Liberty Life of Boston structured settlement block, reinsured by Protective Life, #26)
• John Hancock (10)
• Brighthouse Financial  (15, includes legacy Travelers Insurance Company/ legacy MetLife Insurance Company of CT structures)
• Pacific Life (16)
• Athene (19, includes former Aviva,  CGNU and CGU Life structured settlement business)
• Talcott Resolution  (21, formerly known as Hartford Life)
• Protective Life (26, reinsurer of Lincoln Life of Boston structured settlement business-formerly Liberty LIfe of Boston)
• Genworth (30, roll up and spin off of First Colony, American Mayflower, GE Capital Assurance Company, GE Capital Life  Assurance company of NY)

Source: A. M. Best 2022 List of Largest US Insurerance Groups, published July 2022.

While size matters, it is only one of the criteria one should use in selecting an insurance company to fund a structured settlement.

List of current structured settlement annuity issuers in the USA and their ratings.

 

 

 

 

If You See a Qualified Assignment and Release Like This, Seek a Second Opinion

by Structured Settlement Watchdog

A Qualified Assignment and Release which includes the following, raises more questions than answers. If you see one it probably deserves a second opinion.

QUALIFIED ASSIGNMENT AND RELEASE

Defined Terms

Assignor:___________________ Qualified Settlement Fund,  ( QSF may be adminstered by company related to settlement planner)

Assignee: Qualified Assignment Company related to the settlement planner.

Qualified Funding Asset:  Annuity

Issuer of Qualified Funding Asset :  Metropolitan Life Insurance Company

12. In exchange for "legal payment rights" pursuant to 5891 of the IRC, to the Periodic Payments specified in Paragraph 15. Claimant hereby releases and discharges the defendants and/or respondents with regard to the Periodic Payments, and agrees to only look to  (name of Assignment Company owned by settlement planner firm holding company)

_____________________________________________________________________

SIDE BAR (sponsored by "What's Your Vector Victor?")

Why is the Clamaint releasing and discharging "Defendants and/or Respondents" in the settlement planner's Qualified Assignment and Release document from a QSF?  Wouldn't the "Defendants and/or Respondents" have been released and discharged when the money was deposited in the QSF under the "resolve or satisfy" clause in  § 1.461-2(c)(2)?

Claimant is to Respondent as Defendant is to Plaintiff. See my September 18, 2014 post, What's the Difference between Plaintiff or Claimant, Defendant or Respondent?

________________________________________________________

13. In the event of notice of an application to any court for the transfer of the payment rights under this agreement, (name of Assignment Company owned by settlement planner firm holding company) reserves the right to  effectuate an immediate transfer of ownership of the "Qualified Funding Asset"

Metropoltan Life Will Not Issue a Structured Settlement Annuity to a Settlement Planning Firm's Assignment Company

This author has confirmed with Metropolitan Life Insurance Company, that Metropolitan Life Insurance Company WILL NOT issue a structured settlement annuity to a qualified assignment company other than its own. Furthermore, since MetLife spun off its retail division to form Brighthouse,  a transition which was finalized August 7, 2017, MetLife does not issue retail annuities.

Factored Structured Settlement Payments Bought as an Investment Are Not An Annuity

The acquistion of someone elses' structured settlement payment rights is not the purchase of a structured settlement annuity, in accordance with National Association of Insurance commissioner (NAIC) Statutory Issue Paper No. 160, or an annuity under the laws of most states. In 37 states, investors in other people's structured settlement payment rights do not have the same statutory protections.

What is a Qualified Funding Asset?

According to IRC 130(d)

"For purposes of this section, the term "qualified funding asset" means any annuity contract issued by a company licensed to do business as an insurance company under the laws of any State, or any obligation of the United States, if—

(1) such annuity contract or obligation is used by the assignee to fund periodic payments under any qualified assignment,

(2)the periods of the payments under the annuity contract or obligation are reasonably related to the periodic payments under the qualified assignment , and the amount of any such payment under the contract or obligation does not exceed the periodic payment to which it relates,

(3)such annuity contract or obligation is designated by the taxpayer (in such manner as the Secretary shall by regulations prescribe) as being taken into account under this section with respect to such qualified assignment, and

(4)such annuity contract or obligation is purchased by the taxpayer not more than 60 days before the date of the qualified assignment and not later than 60 days after the date of such assignment".

 

It is clear from the plain reading of IRC 130(d) that obligation refers to any obligation of the United States. So the puzzle is what is the settlement planner getting the payee into here? 

 

If you would like more information on the essentials of  structured settlement documentation, this video may be helpful.