by John Darer CLU ChFC MSSC CeFT RSP CLTC
Strict licensing rules make existing workers richer by reducing competition in their fields asserts Lyman Stone, a research fellow at the Institute for Family Studies (Stone blames Baby Boomers). And while some industries clearly need licensing rules for health and safety reasons he says, most of the growth in licensure has been in fields where health and safety justifications are less salient: Do you really need hours of course work and special exams to be a florist, an interior designer, or an auctioneer?
By privileging existing workers, writes Stone, "licensure rules increase income inequality, and they do so specifically by shifting income toward older workers. When licensure standards exclude felons, they also disproportionately affect minorities. Young people, and especially minorities, are increasingly being legally prohibited from work".
I received my first professional insurance licenses in New York and Connecticut at age 21 and my first securities license at age 22.
Lyman Stone obviously has not studied the structured settlement secondary marketplace in which:
- There is no licensing standard. There is no way to measure even basic core competency, knowledge of state laws related to the profession, to exclude felons. and to deal with the hundred of on registered aliases used by some of the companies those associated with them.
- There is no means to fine, suspend or revoke licenses.
- There is no way for consumers to seek redress without it taking years.
- There is no requirement to carry professional liability insurance.
- Investors in factored structured settlement payments streams have lost their money or are in jeopardy of losing all of their investment in what was touted as extremely safe.
- In most states where structured settlement factoring companies do business without first registering to do business with the Secretary of State when they solicit business from citizens of that state
- Many such unlicensed companies are holding themselves out using terms that implies credentials when those making the claims do not possess them.
- Many such unlicensed companies operate using multiple fictitious names making it difficult for people to know who they are dealing with.
- Richart Ruddie, a millennial from Owings Mills Maryland and Ft Lauderdale Florida, associated with a series of companies banned from doing business in Maryland for 7 years for fraud, had to plea bargain with the Rhode island District Attorney for filing bogus Court documents featuring fictional defendants for his reputation management business, that transmitted documents to a process server using one of the banned company (AnnuitySold) emails.
- On November 9, 2022 Raffi Boghosian, Charles E. Smith, Jr and Anuj Sud, minorities, were convicted of structured settlement theft. Most of the victims were minorities.
- Two unlicensed entities who attempted and may have instigated pennies on the dollar sale of assets using investment projections which wouldn't have passed securities regulators.
- There have been Pennies on the dollar asset liquidations to place in unsuitable investments such as in a rap star's record. Any of the victims of the structured settlement secondary market are disproportionately young minorities, the very people that Lyman Stone is trying to give opportunity, who are targeted and then ripped off by unlicensed sales people who are dispensing awful financial advice. One unlicensed company referred to selling a structured settlement ( for literally pennies on the dollar) as a windfall.
- A convicted felon named Todd Dyer was in the process of setting up a purported marketplace called Income Stream Exchange (for the exchange of structured settlement payments rights) when he was convicted and sentenced to 15 years for another fraud.
It's not so clear what research Lyman Stone performed to form his opinion that course work and special exams to be a florist, an interior designer, or an auctioneer are less salient. Licensing standards not only benefit consumers but employers as well. Frankly if I'm spending money do re-do my kitchen I want someone who knows what they are doing. And do you want someone putting a straight edge razor to your throat to shave you without a license? The fees charged help fund the cost of administration.
Last updated December 7, 2022