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Risks of Buying Life Contingent Structured Settlement Payments Highlighted in New Jersey Transfer Petition

by Structured Settlement Watchdog

A  27 year old single employed Toms River New Jersey man proposed to enter into a Transfer Agreement and Addendum to Transfer Agreement ("collectively, the Transfer Agreement") with RSL Funding, which will receive an assignment of a portion of Payee's structured settlement payments as follows: One Hundred Sixty-Eight (168) monthly life-contingent payments each in the amount of $701.18 due beginning on June J, 2047 through and including May 1, 2061 (collectively, the ''Assigned Payments") under an annuity owned by Lincoln Assignment Corporation f/k/a Liberty Assignment Corporation and issued by Lincoln Life Assurance Company of Boston f/k/a Liberty Life Assurance Company of Boston.

Source:  RSL Funding, LLC v Lincoln Life Assurance Company of Boston  Superior Court of New Jersey County of Ocean OCN-L-000394-21 filed February 4, 2021

Proposed Structured Settlement Transfer Would See Seller Get $2,000 Up-Front and Monthly Payments for 60 months Starting in 36 years!

In exchange for the Assigned Payments, Payee (Seller) is expected to ultimately receive gross payments totaling $32,500.00, which is comprised of: (i) an initial lump sum payment of $2,000.00 (the "Initial Payment" as set out in the Disclosure Statement and Transfer Agreement) upon the entry of an Order by this court and pursuant to the terms and conditions set forth in the Transfer Agreement, payable by Transferee or its assignee, subject to Payee then still living; and (ii) a total of $30,000.00 payable, pursuant to the terms and conditions as set forth in the Transfer Agreement and Disclosure Statement (subject to Payee then being alive) by Transferee or its Assignee, consisting of conditional additional monthly ·payments of $500.00 each over sixty (60) months from June 20, 2056 and ending on May 20, 2061. 

What Are Life Contingent Payments?  What Are the Risks of Buying Life Contingent Structured Settlement Payments?

The payments being assigned under this transfer are life-contingent, meaning that they are only payable if the Payee is alive on the date the payments are made. Thus, the Payee and, upon approval of the proposed transfer, Transferee's assignee ("Assignee"), are at substantial risk of not receiving these monies especially because of the expected age of 67 when the payments end.

How Do Buyers Evaluate the Risk of Buying Life Contingent Structured Settlement Payments?

RSL says in the Verified Complaint that additional steps must be taken during the course of this transaction so that RSL and the Assignee may adequately evaluate the risks associated with the proposed life contingent transfer. Specifically, a medical evaluation or alternative underwriting of the Payee has been performed or is currently underway which are analogous to medical underwriting process performed by a life insurance company when considering issuing a life insurance policy. The Payee completed a medical questionnaire upon which RSL and the Assignee rely and the Payee has agreed to participate in further health screenings and medical testing, as appropriate.

The court filing states that a review by RSL of Payee's overall health and/or medical history at this stage reveals at least one issue of concern. Without going into specifics of Payee's health morbidities or medical history in a public filing, at Payee's request and in light of Payee's privacy, Payee's medical history and/or health-related issues directly affect Payee's mortality. Moreover, because the medical history and/or health-related issues directly and materially affect the likelihood of anyone realizing the full benefits of this proposed transfer for which the first of the Assigned Payments is not due until June 1, 2047 more than 26 years off In light of the high risks associated with this proposed transfer, RSL and Payee have agreed to the terms of this transaction as set forth herein.

Is Buying the Rights to Structured Settlement Payments Buying Structured Settlements?

by John Darer CLU ChFC MSSC CeFT RSP CLTC

A Facebook advertisement associated with a veteran settlement planner solicits investors to "buy structured settlements" caught my eye this morning. It's misleading because nobody can actually "buy structured settlements". Structured settlements are a form of settlement not a product. For example a settlement can be resolved in consideration of a lump sum, periodic payments or a combination. Despite what you may see advertised, you simply can't go to

It seems fair to know what I'm actually buying, right?

a marketplace such as Wegmans, Publix, Shoprite, Stop and Shop to buy structured settlements.   

What Investors Need to Know

1. Consider the definition of structured settlement found in the Internal Revenue Code Section 5891 (c)(1) states:

(c) Definitions. --For purposes of this section--

(1) Structured settlement. --The term “structured settlement” means an arrangement--

(A)  which is established by--

(i)  suit or agreement for the periodic payment of damages excludable from the gross income of the recipient under section 104(a)(2) , or

(ii)  agreement for the periodic payment of compensation under any workers' compensation law excludable from the gross income of the recipient under section 104(a)(1) , and

(B)  under which the periodic payments are--

(i)  of the character described in subparagraphs (A) and (B) of section 130(c)(2) , and

(ii)  payable by a person who is a party to the suit or agreement or to the workers' compensation claim or by a person who has assumed the liability for such periodic payments under a qualified assignment in accordance with section 130 .

2.   IRC 5891(c)(2) defines Structured settlement payment rights. --The term “structured settlement payment rights” means rights to receive payments under a structured settlement.

Structured settlement payment rights or factored structured settlement payment streams are what is available for purchase in the secondary and tertiary markets. 

3.  IRC 5891(c) (3) Structured settlement factoring transaction. --

(A) In general. --The term “structured settlement factoring transaction” means a transfer of structured settlement payment rights (including portions of structured settlement payments) made for consideration by means of sale, assignment, pledge, or other form of encumbrance or alienation for consideration.

Is it too much to expect that a veteran settlement planner associated firm should get the fundamentals right in structured settlement investor facing marketing materials?

Beware Paid Actor Testimonials by Structured Settlement Factoring Companies

by Structured Settlement Watchdog

Over the years I've covered a number of individuals or entities in the structured settlement secondary market who use paid actors to give testimonials. In many cases there is no disclosure that these are paid actors or actresses.

• Einstein Structured Settlements- a brainchild of Owings Mills' High School chums Richart Ruddie and Ryan Blank, whose pathetic antics saw their JR Funding and other companies banned from doing business in Maryland for 7 years, in January 2018, after a Maryland Attorney General investigation. One of most ridiculous paid testimonials associated with the Owings Mills chaps was a now former LatinX Fiverr actress named "Fabiola" or "pinkkoala", who claimed in Spanish to have sold her structured settlement to buy a Bentley and oceanfront property in Florida.  It was a cheap $5 hustle as an opening gambit in the marketplace and it obviously all went downhill from there for these chaps, with the "Fish N Chip scandal" and later the 7 year Maryland ban.
  

  The print is so small on the paid testimonials that I "ant" read it without my 3-D glasses
• Sovereign Funding Group, a brainchild of David Springer of Mt Airy Maryland who, upon information and belief is no longer in the space. In one of the erstwhile paid testimonials, a Fiverr actress named Old Bitty Grandma misrepresented Springer as a lawyer, "not like all the others". The fake paid testimonial was played in Court during the trial in Woodbridge v Springer in August 2014. Even after he was supposedly no longer in the structured settlement business, there appeared two testimonials from purported Sovereign customers who were actresses found on paid testimonial sites.
• Lead generation website NL Brand Reviews NLRBFCU.org, portrayed a non existent person as its editor-in-chief. Only when her bio was checked, the references of social club and college supposedly attended didn't check out.

I'm October 2019, a Delaware based structured settlement factoring company that solicits business in the United States posted video "testimonials" from individuals without any noticeable imperfections, speaking in glowing words from waterfront property. Barely visible words in ant-sized "micro-print" state that the testimonials are portrayed "by paid actors to protect the privacy of customers". That's a small positive, but farcical, in my opinion. If someone is in such bad shape that they are willing to trade their stable source of income for pennies on the dollar, do you believe they have the money to get gleaming white veneers on their teeth?

The following video titled "These Actors Will Read Anything That You Pay Them" is an Inside Edition investigative report that takes a serious, but humorous look at paid testimonials. 

 

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SF Weekly Publishes the Dumbest Piece About Structured Settlements Ever, for Profit

by Structured Settlement Watchdog

San Francisco's weekly rag, the SF Weekly has published one of the dumbest pieces about structured settlements ever.  "All You Need to Know About Structured Settlements and How to Sell Them" is accredited to an unidentified paid sponsor which peddles pennies on the dollar financial smack to consumers. SF Weekly claims to be "San Francisco’s smartest publication. That’s because we take journalism seriously".  My question is where does taking in money from paid sponsors, enabling them to unload more crap than on the streets of San Francisco  intersect with "serious journalism"?

Lie #1

"It is absolutely legal to sell a structured settlement for instant cash".

What SF Weekly published  on January 16, 2021 in exchange for money from a sponsor is a total lie because  If you sell your structured settlement you will not get instant cash. A small advance perhaps, but not instant cash.

Lie #2

"When somebody plays a part in another person’s injury or financial losses, they’re compelled by a judge or jury to pay a compensation to the wronged party. This compensation is known as a settlement"

What SF Weekly published on January 16, 2021 in exchange for money from a sponsor is wrong because neither a judge nor jury awards a settlement.  The "awarded a settlement" vortex is one of the "Ground Hog Day" of financial illiteracy spread by financial illiterates in (or hired by) the structured settlement secondary market.

Ignoring the legal concept of negligence, one of the examples used in the lie, and published on January 16, 2021 by SF Weekly in exchange for money from a sponsor is "A quack doctor paying a settlement to a patient for prescribing a wrong medication or administering a wrong treatment. 

A quack doctor is "an unqualified person who claims medical knowledge or other skills"  [Source: Collins English Dictionary].

In order to practice medicine in California, one must be licensed by the Medical Board of California, which states its mission "is to protect health care consumers through the proper licensing and regulation of physicians and surgeons and certain allied health care professionals and through the vigorous, objective enforcement of the Medical Practice Act, and to promote access to quality medical care through the Board's licensing and regulatory functions".   [Source: Medical Board of California}

Taking the example of the sponsor of the article that SF Weekly took money from, would a "quack doctor" qualify for medical malpractice insurance to have money to pay a settlement?   A big part of an application for medical malpractice coverage involves credentialing. Medical schools attended, Internships, Residency, Fellowship, Other Training, details of prior coverage,  practice information, hospital staff appointments, board certifications, list of states where licensed and license numbers. List all counties and states where you are currently practicing, and the corresponding percentages of patient hours expended in each [ Sourced from application from the largest medical malpractice insurer in the United States]

What is medical negligence?

“The elements of a cause of action for medical malpractice are: (1) a duty to use such skill, prudence, and diligence as other members of the profession commonly possess and exercise; (2) a breach of the duty; (3) a proximate causal connection between the negligent conduct and the injury; and (4) resulting loss or damage.” (Lattimore v. Dickey (2015) 239 Cal.App.4th 959, 968 [191 Cal.Rptr.3d766].)

Lie #3

In describing how settlements are paid. SF Weekly Publishes Lie #3 on January 16, 2021, in exchange for money from one of its sponsors , that a settlement is paid as a one-time payment, wherein the offender pays the wronged party compensation they're owed in one go. Alternatively it is described as a structured payment wherein an offender agrees to pay a regulat stream of payments.... The latter is also known as " structured settlements"

• An offender is someone who commits an illegal act.
• Criminal negligence is the reckless disregard for the safety or life of another human being. An act of negligence that is so serious it could constitute a criminal offense, e.g. the negligence regarding the care of a child is so severe it would make the accused criminally responsible.
• Then there is the case of Mens Rea. Did the doctor have it?  To illustrate, we'll  go old school on this one with a classic scene from "See No Evil Hear No Evil"
  

Generally structured settlements settlements are entered into by Defendants and Insurers (in some cases qualified settlement funds) as consideration for a release of liability from claimants or plaintiffs.

Lie #4 Published by SF Weekly January 16, 2021, in exchange for money from a sponsor

"You’re not breaking any law by selling your structured settlement. What you’re simply doing is borrowing from your future payments. It is still your money, only that you’re getting it before the due date".

A structured settlement transfer is a sale and irrevocable assignment of structured settlement payment rights for pennies on the dollar. You will ALWAYS lose money.

Lie #5 Published by SF Weekly January 16, 2021, in exchange for money from a sponsor

"This rate usually ranges from 9 to 20 percent, depending on the perceived risk associated with your payment" says the article. Factoring companies charge a discount rate on the sale of structured settlement payments. Sellers get a percentage of the present value. That is literally only pennies on the dollar. But the reality is that rates are available well below 9%. Don't be a sucker consumers!

 

 

 

"$600 Stimulus Check Not Enough Sell Structured Settlement" Says Structured Settlement Factoring Ad

by Structured Settlement Watchdog

In the immortal words of Aretha Franklin "You better think (think) think about what you're trying to do to me!"

While selling your structured settlement is always an option, if you have a reason and a court in the county in which you reside approves, realize that you are getting a pennies on the dollar deal.  In other words you better think (think)!

Here is what one structured settlement factoring company is advertising at the time of publication:

"There were shared reactions of side eyes and eyebrow raises when U.S. government officials announced that a second stimulus check would be distributed to the public…a check in the amount of $600. The move aimed to provide U.S. citizens a financial reprieve during the COVID-19 pandemic. But many people believed that this “follow up” stimulus check was a far cry from the first stimulus payment of $1,200. People experiencing true financial hardship wouldn’t be able to scratch the surface of their debts with a meager $600 bucks. If you share this sentiment, but also have a structured settlement, listen up: Selling all or some structured settlement payments can supplement the $600 stimulus and provide real relief as the COVID-19 pandemic rages on."

The approach is simply an attempt to prey on people's emotions to induce them to make a potentially unwise decision without any thought as to the aftermath. Some companies do the same thing with holiday gifting.

There is no way any structured settlement factoring company is going to allow you to sell a minimal amount of your payments to make up for the $600 stimulus differential. You will be forced to sell more because at the very least there are (1) attorney fees (2) court filing fees (3) insurer fees and other costs associated with the transfer of structured settlement payment rights. As Earl Nesbitt, a Texas lawyer and former Counsel to the National Association of Settlement Purchasers once said on Legal Broadcast Network "it's not like you're going to the ATM"

 

via GIPHY

Don't Sell Your Structured Settlement to Pay Off Student Loans

by John Darer CLU ChFC MSSC CeFT RSP CLTC

Structured settlement payees should do their best to avoid selling their structured settlement payments for pennies on the dollar, "to help pay for college" or "help pay off college loans".  Many times the effective discount rate on proposed deals to sell your structured settlement are really not a good deal at all because they exceed your student loan rate.

President Biden has called for forgiving $10,000 in student loan debt as part of a broader coronavirus relief package from Congress, while Senators Schumer and Warren have pushed for vanquishing up to $50,000 in student debt. If you can hang in there without eroding the stable tax-free income provided by your structured settlement then it may be worth the wait.

Always seek independent professional advice from someone unrelated to the settlement purchaser that is soliciting you.

PA Structured Settlements | Court Tosses Appeal of Why Wouldn't THE Best Interest Be in the Payee's Best Interest?

by Structured Settlement Watchdog

Intervenor is Blanked Over "Poached" Structured Settlement Egg After They Thought They'd Get "Over Easy"

VIP Services Corporation tried to poach a structured settlement factoring deal involving a resident of Pennsylvania with a more attractive rate and lost. It then appealed and lost in a case that brings Pennsylvania's "best interest" test  into the fore.  The operative question is if the reasons for selling are purely financial, why wouldn't a better deal be in the Payee's best interest?

According to Court records, VIP Services Corporation (Appellant) appealed from an order entered in the Allegheny County Court of Common Pleas, granting the joint petition to transfer structured settlement payment rights filed by payee Tyecia Hutchins (Payee) and transferee TBT Services, LLC (TBT). According to court records, TBT is a limited liability company organized under and pursuant to the laws of [the] state of Wyoming. [P]ayee . . . is an adult individual of full age who resides in Pittsburgh, Allegheny County, Pennsylvania. As a result of personal injuries [received when she was a minor, Payee] was entitled to receive future structured settlement payments. Court filings state that the Annuity owner is Pacific Life and Annuity Company and the Annuity issuer is Pacific Life Insurance Company. 

______________________________________________________________________________________________________________

SIDE BAR

Upon information and belief, the Annuity Owner would likely be Pacific Life and Annuity Services, Inc.(PLASI) not Pacific Life and Annuity. Pacific Life Insurance Company became the underwriting company for structured settlements established pursuant to settlements in all states except New York, in 2012. Pacific Life and Annuity, which since 2012 is the Pacific Life underwriting company in New York settlements is not a qualified assignment company.  PLASI is the qualified assignment company for Pacific Life and as such, would be the owner of any structured settlement annuities issued by any of the Pacific Life underwriting life insurance companies.

______________________________________________________________________________________________________________

VIP Services Corporation was granted permission to intervene in this matter. On appeal, Appellant contends the trial court erred when it scheduled a hearing despite defects in the joint petition, and when it determined the transfer was in Payee’s best interests. IN RE: TYECIA HUTCHINS APPEAL OF: VIP SERVICES CORPORATION IN THE SUPERIOR COURT OF PENNSYLANIA  J-A28035-20, Appeal from the Order Entered February 12, 2020 In the Court of Common Pleas of Allegheny County Civil Division at No(s): GD-20-000414  Download J-A28035-20m - 104631710121860271 Hutchins VIP Services Corporation Appeal

According to the December 11, 2020 Appellate decision, "on or about January 2, 2020, [Payee] executed an “Absolute Sale, Transfer and Assignment of Structured Settlement Payment Rights” (the “Agreement”). The Agreement provided for the assignment of future payments to TBT and/or its designated assignee. TBT provided a Disclosure Statement, setting forth, inter alia, the amounts and schedule of payments to be transferred to [Payee]. The Disclosure asserts that [Payee] intends to sell future payments at a discounted present value of $27,131.88. The Disclosure stated the total amount [Payee] would receive for the transaction, as well as . . . the specific payment amounts and timing of the individual structured settlement payments. The disclosure also included the fee applied for [Payee] to enter into he [Agreement,] effectively, . . . an interest rate of 22.14% per annum[.] In paragraph twelve (12) of [Payee and TBT’s] Joint Petition, they state, “[a]fter due consideration, Payee . . . is satisfied that the transfer is in her best interests for the reasons set forth in the Affidavit attached hereto as Exhibit “C”. Again, [Payee] is an adult individual of full age. Further, paragraph fifteen (15) of the . . . Joint Petition maintains that “Payee . . . has executed an Acknowledgment confirming that she has waived independent legal advice, including consideration of any tax ramifications of the transfer.[”] 

"Next, Appellant argues the trial court erred when it approved the joint petition since the transfer was not in Payee’s best interest. Appellant’s Brief
at 21. Appellant insists that because Payee’s reasons for transferring her settlement payments were “purely financial,” the trial court should have found
that its proposed transfer, which included more favorable terms than the TBT offer, was in Payee’s best interests. Id. at 21-22. Indeed, Appellant
maintains the trial court neglected its guardianship role when it ignored “uncontroverted evidence” that the settlement offer from Appellant had
“better financial terms” than the offer in the joint petition".  [Ibid.]

VIP Services Corporation raised the following two issues on appeal:
1. Did the trial curt err when it approved the TBT Petition because Pa.R.C.P. 229.2 required the trial court to deny the TBT Petition?
2. Did the trial court err when it approved the TBT Petition, finding it to be in [Payee’s] best interests to do so, because the financial terms of the assignment in the TBT Petition were worse than those contemplated by [Payee’s] agreement with [Appellant]?

VIP Services Corporation claims concern the interplay between the Structured Settlement Protection Act (SSPA), 40 P.S. §§ 4001-4009, and Pennsylvania Rule of Civil Procedure 229.2. The SSPA mandates court approval for the transfer of any future structured settlement payments.3 See 40 P.S. § 4003(a). In particular, the Act requires the payee establish that “the transfer is in the best interests of the payee or his dependents.” 40 P.S. § 4003(a)(3).

But it was the allegation by the annuitant in the Court record that VIP Services Corporation threatened that "They Were Going To Send People" to her house (for nixing the deal) that really got my attention. 

"At the hearing, Payee acknowledged that she had entered into a contract with Appellant in late November or early December of 2019, to transfer two future settlement payments. N.T., 2/12/20, at 11, 17. However, she later decided to “cancel[ ]” that contract and enter into an agreement with TBT. Id. at 11.
She explained:  I was being threatened that [Appellant] would intervene today. They’ve harassed me and said they were going to send notaries
to my house, and if I didn’t deny the court hearing with [TBT],that they were going to send people to my house"

Who is VIP Services Corporation?

Upon information and belief VIP Services Corporation has an association with Genex Capital Corporation. While there is no website for VIP Services Corporation, as far as a reasonable web search can tell, a Connecticut application for transfer filed in the same time frame states Applicant, "VIP Services Corporation (the “Transferee”) is a corporation duly organized and validly existing under the laws of the State of Delaware, and maintains a principal office at 73 Green Tree Drive, #99, Dover, DE 19904". The Dover Delaware address is a UPS store mailbox that is known to be the address of record for Genex Capital Corporation in the United States.  It is the address that Genex Capital Corporation states on its website at the time of posting [ In Re VIP Services Corporation v Favio Torres   Superior Court CT  JD-New Haven  NNH-CV19-6097971]. The Structured Settlement Annuity Sale and Assignment attached to that application as an exhibit, is signed by Roger Proctor, CEO of Genex Capital Corporation.

 

Ethics or Optics? | Personal Injury Lawyers Represent Companies Buying Structured Settlements For Pennies on Dollar

by Structured Settlement Watchdog

A number of personal injury lawyers, including those admitted to the New York State Bar, are representing structured settlement factoring companies in

Ethics or optics? Personal injury lawyers who represent structured settlement factoring companies

transactions that result in recipients of structured settlement payments receiving no better than pennies on the dollar. The same lawyers and/or firms also advertise and solicit business from personal injury victims. 

One such law firm, known to have represented structured settlement factoring companies in thousands of cases advertises the millions it has recovered for injury victims, while at the same time asks if you have an an annuity or structured settlement to support its "facilitating access to your money". 

Another personal injury firm, which is now disbanded, advertised that it was a personal injury law firm "committed to representing innocent accident victims who have suffered serious and catastrophic personal injuries" while also representing some of the biggest structured settlement factoring companies in the business.

Recently I came across another firm in the New York City area which advertises it does personal injury but has popped up in representation of pennies on the dollar merchants. The law firm also shares an office address with another lawyer who is listed as an Independent Professional Advisor on a number of the first law firm's cases.

I can't help thinking that this may be going on all across the United States. While not dismissing a person's right to make a living, in my opinion such representations deserve scrutiny by such firms for potential conflicts of interest.

Areas of potential conflicts of interests include:

• How data acquired during the legal representation for the personal injury case is used. 
• How that data is protected?  Is there a Chinese Wall?
• Has the lawyer considered structured settlements for his or her clients in the past?  Are they making structured settlements available to their clients for consideration? 
• If one of the lawyers past clients returns with questions about selling their structured settlement payments, what happens?  Does the lawyer refer the matter out or do they handle their former client's sale. 
• Does the lawyer/law firm disclose that he/she or it derives income, perhaps substantial income, from pennies on the dollar merchants?  
• Susceptibility of the lawyer/law firm or one of his/her or its employees, to potential inducements that the lawyer/law firms secondary market clients may offer for referrals
• Directly or indirectly buying factored structured settlement payment streams of clients

The is something that should concern not only judges, but consumers and other lawyers. 

 

 

 

TapFinancing.com "Transaction Audit Program" 202-747-0446

by Structured Settlement Watchdog

Have you received an email from Amber Dawson or Andrea Moore Vice-President of Underwriting Department of the nebulous  "Transaction Audit Department"

"Tap Financing" for Pennies on the Dollar

of Tapfinancing.com?   It's an advertisement for selling your structured settlement payments.  That's right you can step right up and turn on the tap to get pennies on the dollar.  But it turns out even that isn't so easy.

Neither the purported company nor any of the people on the solicitation appear to exist on January 15, 2021.. No Linkedin profile. "Crickets" on a  Google search. The phone number 202-747-0446 ext 45046 could not be reached from multiple numbers with different area codes.

Tapfinancing.com was registered using Name.com in July 1, 2020.  The name servers are listed as BUY.INTERNETTRAFFIC.com and SELL.INTERNETTRAFFIC.com

Enough said.

 

Niagara County Judge Murphy Shows How to Question a Structured Settlement Transfer Petition

by Structured Settlement Watchdog

Niagara County New York Supreme Court Judge Matthew J. Murphy , is yet another fine example of why New York judges are among the best in the USA in

Niagara County Supreme Court in Lockport New York

enforcing their state's structured settlement protection act, with his January 8, 2021 decision in Tiger Parrish, LLC Petitioner v BHG Structured Settlements, inc et al. Respondents , Index E173532/2020.

The petition involved the proposed transfer of structured settlement payment rights from 4 structured settlement annuities due to a 23 year old, with aggregate payments totaling $2,313,704.40 in exchange for an aggregate purchase price of $895,647.03. The effective discount rate according to the mandatory disclosures was 6.10% which, while not bad, still had a considerable amount of fat. Our sources indicated that between $1,000,0000-$1,122,456.99 would have been possible.

Sacco & Fillas was the law firm representing the settlement purchaser, Tiger Parrish , LLC. True to form with some of the Sacco & Fillas petitions I've seen, their cited case support for discount rates are what one might irreverently and figuratively describe as "antediluvian".

Judge Murphy's thoughtful analysis reviewed prior transfers and attempts to transfer along with reasons that were stated in the prior petitions. The current petition reviewed by Judge Murphy also reviewed the budget and expenses , but noted that the Petition and the seller's affidavit " do not provide a complete picture  of the seller's financial landscape". The Judge went into granular detail and said that "in order to make a best interests' determination, as required by law a full explanation of the settlement must be provided."

But the kudos in my opinion for Judge Murphy are deserved for noting that payments would be sold at a discount diplomatically skewering the investment projections. The Petition to Transfer included Exhibit 14 labeled IPA included an investment projection with a 12.5% rate of return, but apparently fail to take into account income taxes and there appeared to be no stochastic analysis  (also known as Monte Carlo analysis) that take into account multiple variables!  Download Eglow Investment Projection Linear 12.5 pct 

Judge Murphy observes that " investing in the stock market always  involves some risk. Additionally, despite the voluminous documentation there is no simple comparison of what Mr. M. (the seller) can expect to receive now; and an explanation of the safeguards which will be imposed on the proceeds of teh transfer so that Mr M. is not able to liquidate said proceeds without Court approval.  Nor has  Mr. Eglow provided, at a least in simple comparison, any analysis of the tax consequences of investing in the stock market compared to annuity payments. It is the Court's understanding that the annuity payments are not taxable. If that is correct, it could affect Mr. Eglow's analysis".

According to New York's General Obligations Law Section 5-1701(e) “independent professional advice” means advice of an attorney, certified public accountant, actuary or other licensed professional adviser:

(i) who is engaged by a claimant or payee to render advice concerning the legal, tax and financial implications of a structured settlement or a transfer of structured settlement payment rights;

(ii) who is not in any manner affiliated with or compensated by the defendant in such settlement or the transferee of such transfer;  and

(iii) whose compensation for rendering such advice is not affected by whether a settlement or transfer occurs or does not occur;

The papers say that Eglow and his firm will be providing financial planning services (for which he will presumably be compensated).

A December 15, 2020 letter from Jeffrey Eglow, of Newbridge Securities was submitted December 16, 2020 to Judge Michael Cresitello in support of a Middlesex NJ Petition to transfer involving Park St Closing LLC.  In the letter Eglow represents that he has had "many discussions regarding all aspects of her transaction and my advice, I respectfully request her transfer"  (emphasis added). It is evident in my opinion, that either there wasn't any discussion about the market in discount rates for income payments that begin in 2020 on one of the deals and 2021 on another with the third being a deferred transaction, or Eglow was brought to "the dance" by those charging her 12% plus . Selling a structured settlement is a money loser, 100% of the time.  Instead of investing x$, with a more competitive discount rate, the seller in that case might have considerably more to invest, or she might not need to sell as much, just like the Niagara County case, but with much worse discount rates in 3 separate deals bearing discount rates of 12.8*, 12.81% and 12%. There were hundreds of thousands in the factoring profit spread, according to our sources.  See Park St Closing LLC v Moronta C  Case# MID-007817-20.