The Wall Street Journal
You've seen the late night TV commercials. You can get "CASH" for your structured settlement payments NOW!
Sheds Light on "Factored" Structured Settlements
"Let us help you out of that burdensome, extremely attractive and secure guaranteed income tax-free cash flow you are receiving," the paid spokesperson suggests. "We understand your problem and will give you the money YOU deserve such is our benevolence!"
In a perfect world, the spokesperson would, at this point, grow horns and start laughing maniacally. I imagine the scene from Planes, Trains and Automobiles where John Candy and Steve Martin get wedged between two semi-trucks while driving the wrong way down the highway.
But the world is imperfect and people aren't always able to see the truth that often lurks behind a well-crafted advertisement that is, most would argue, designed to exploit.
In this rare weekend edition of our newsletter, I'm writing to praise financial columnist Jason Zweig for his article which appeared in today's edition of The Wall Street Journal shedding necessary light on the emerging practice of selling factored structured settlements.
Click [HERE] to read "Another Can't Miss Deal That Can Miss Spectacularly"
In an odd way, the fact that a secondary market has spawned from a secondary market speaks volumes about the attractiveness of the structured settlements in the first place.
It suggests, to me at least, that investors would love to be on the receiving end of an original structured settlement.
Trouble is, since structured settlements are only available to people settling a personal, physical injury claim, they are not available for purchase directly. That is unless they are purchased, after the fact and "at a deep discount" as the article points out, by companies wanting to capitalize on their original attractiveness.
Although the article steers clear of the ethical issues surrounding investors who make money off of people who have suffered physical trauma, it seems appropriate that the lone graphic used in the article shows a turkey vulture roosting on a yield sign.
For more perspective on this theme, clients may wish to revisit a few of the videos we have posted on our website under the "What They're Saying"
tab. Specifically, those of Sen. Richard Durbin and Rep. Joe Courtney (videos 5 and 6) of the United States Congress both of whom are former trial attorneys who strongly support structured settlements and are opposed to factoring.
Have a great weekend and "Thank You!" for the opportunity to be of service!
Dan Finn, CPCU, CSSC
Certified Structured Settlement Consultant