I help root out and correct inaccuracies in social media and other online media related to structured settlements, wherever they exist.
1. Help curtail the ongoing wholly misleading and fraudulent practice of misrepresentation by merchants to potential investors in structured settlement receivables (acquired structured settlement payment rights) that such structured settlement receivables are "annuities" or "secondary market annuities" or referenced through snappy but misleading acronyms such as SMA and SMIA and bogus claims like "unparalleled financial safety" by salespeople and their companies, including some settlement planners and financial planners who have insurance or securities licenses and who should know better.
2. In 2017, in the matter of Greenwald v. Caballero-Goehringer M.D. et al., a Delaware judge dismissed an attempt to portray a Genex Capital Receivables Purchase Agreement as a structured settlement annuity in a medical malpractice case involving a minor.
3. In an unrelated matter, it was later discovered on the Internet that a July 31, 2012 declaration under penalty of perjury authored and signed by a California settlement planner in support of a petition to the California Superior Court for the City and County of San Francisco to create a qualified settlement fund and use the QSF to buy structured settlement receivables, despite the receivables not being an annuity or insurance contract.
4. The National Association of Insurance Commissioners (NAIC) implicitly stated in Statutory Issue Paper 160 (finalized April 6, 2019) that factored structured settlement payments are neither an annuity nor an insurance product.
5. Patrick Hindert, the co-author of what is widely regarded as the seminal industry text Structured Settlements and Periodic Payment Judgments, wrote in September 2020 that these “are neither annuities nor structured settlements”.
6. In its answer to Plaintiffs' First Amended Complaint and Counterclaims in ongoing Arizona litigation, dated June 11, 2021, Genex Capital Corporation admitted, in answering paragraph 31, that “one component of its business involves purchasing from payees future structured settlement payments due under structured settlement annuities and assigning to investors a subset of those rights...” (Emphasis added) (also multiple other references to “subsets of those rights”). Source: Genex Capital Corporation, a Delaware Corporation v. Seeley Capital Management, Inc., a Massachusetts corporation; et al. and Related Counterclaim. Richard L. Keefer and Vicki L. Keefer, husband and wife, et al., v. Genex Capital Corporation, a Delaware Corporation, et al., and Genex Capital Corporation, a Delaware Corporation, a Delaware Corporation v Richard L. Keefer and Vicki L. Keefer, husband and wife; Hunmi Pak, a married man; E. Dwayne Walls, a married man; and PANABCO, a partnership, Arizona Superior Court, County of Maricopa, Case Nos. CV 2020-013796 and CV2020-004958 (Consolidated) [the pleadings are a matter of public record].
7. Subsequent documents in a related case in TX also refer to a Receivables Purchase Agreement, the purchase of receivables as opposed to an annuity, and subsets of the receivables, where the buyer has elected not to take a direct assignment as opposed to a serviced payment. [see In Re: Juan Oltivero Cause No. B9545-1211 In the District Court of Castro County, Texas, 242nd Judicial District, Genex Capital Corporation First Amended Cross Claim and Second Supplemental Petition Against Third Party Defendants Stratcap Investments, Inc., David Meyerowitz and Douglas M. Evans and Intervenor New England Annuity Associates, LLC filed October 4, 2023, alleged, “Meyerowitz and Stratcap followed Genex’s instructions at that time. Meyerowitz caused Stratcap to process the transfer and obtain an Order entered by the Supreme Court of Onondaga County, New York on or about November 30, 2010 approving the Curtis Transfer (“New York Order”). Immediately thereafter, Stratcap signed all of its rights to Genex, as it (Stratcap) had been instructed by Genex to do. 19. On December 8, 2010 Genex then assigned a subset of limited payment rights to Mr. Leonard as facilitated by Seeley Bulbrook in accordance with, governed by and subject to a Genex Receivable Purchase Agreement (hereinafter “Genex RPA”). This was the custom and practice for all dealings....” Bold added for emphasis.
8. Additional references to receivables appear in Morningstar DBRS, Inc. “(DBRS) confirmed the ratings of seven securities issued by six asset-backed security transactions secured by structured settlement receivables. The performance trends of the securities are such that credit enhancement levels are sufficient to cover DBRS’s loss expectations at their current rating levels. The transactions reviewed were:
- NYLIMAC 2010-SS-1, LLC, Series 2010-1;
- Novation Receivables Funding LLC, Series 2010-A;
- SuttonPark Structured Settlements 2011-1 LLC;
- SuttonPark Structured Settlements 2012-1 LLC;
- Novation Ventures 2013-A Structured Settlement Notes; and
- NV Funding LLC, Series 2014-A Fixed Rate Asset Backed Notes.
9. The definition of annuity under many state insurance laws runs counter to the representations made by those who market structured settlement receivables to investors as annuities. Buyer beware!
10. Acquired structured settlement payment rights in factored structured settlement receivables are excluded from statutory protections under the laws of majority of US states. The 2017 Revisions to the Life & Health Guaranty Associations Model Act (#520), which have been adopted by 40 states, expressly exclude such investments from state insurance guaranty fund protection. Investors should bear in mind that adoption of changes in the Model Act have been retroactive, as expressly provided in the Model Act! There is no equivalency in status for investors in receivables, to people who have actually bought annuities from an insurance company, or are receiving a structured settlement established as part of the consideration for their compromise of their claims for damages. So you're not immunized if you bought structured settlement payment rights before your state adopted (or in the future adopts) the 2017 revisions.
- Encourage the disclosure of transaction risk that has been absent in the sales pitches and/or materials of many of the salespeople placing the factored receivables, which unfortunately has even included certain settlement planners. The documented case history of investment loss can not be written off.
- Make sure that consumers aware of the possible lack of errors/omissions or professional malpractice insurance coverage, or possible policy exclusions for advise buying assigned payment streams in the secondary or tertiary market. One of the formerly leading tertiary market actors, SMA Hub is kaput.after some very exotic deals and is no longer in business after investors lost money.
- Warn and educate partial sellers of structured settlement payment rights and investors in structured settlement receivables of risks associated with payment servicing that may not have been fully disclosed, or disclosed at all.
- The SuttonPark nightmare that Structured Settlement Watchdog John Darer has covered extensively to fill the information void is greatly appreciated by SuttonPark victims who are in the midst of an unprecedented humanitarian crisis. John Darer recognized the possibility of bankruptcy of a payment servicer in 2009 and has covered the topic extensively.
- Root out and expose misrepresentation and fraud in the structured settlement secondary and tertiary markets.
- Expose the use of fake testimonials by members of the structured settlement secondary market
- Encourage potential informants and other commentators who expose, or help to expose bad business practices, with the goal to improve the greater structured settlement industry for consumers and all stakeholders
- Encourage individuals (either annuitants, brokers or structured settlement factoring insiders) with knowledge of bad practices, to come forward to provide information that will lead, if applicable, to the criminal prosecution of the most serious offenders whether in the United States or elsewhere. An international structured settlement ''neighborhood watch" if you will.
- Encourage the establishment and maintenance of higher standards for Independent Professional Advice (Structured Settlement IPA) under state structured settlement protection acts, and support state laws that establish a requirement for an independent guardian for such transactions.
- Seek resolution for structured settlement annuitants and help preserve the integrity of the industry by reporting instances where a structured settlement protection act's "best interest standard" has been inadequately enforced
- Encourage legislators to establish critical licensing and/or registration and oversight for the structured settlements secondary market, so that individuals with criminal records are not allowed to be put in positions of trust involving money consistent with securities and insurance regulations
- As a deterrent to abuse, encourage the universal adoption of a law, similar to that in effect in California, that requires the attorney of record to be notified if a structured settlement annuitant is selling structured settlement payments within 5 years of establishment of the structured settlement.
