The rat in the settlement industry, someone is selling names to factoring companies and it’s about to get messy

Sure it’s a long title, but how else do you get the attention and focus of people in the structured settlement profession that there is growing evidence of a rat in our profession, and possibly more than one. As Jack Nickelson says in “The Departed”” I hate a rat “and I think in this case most of the responsible brokers in our profession are in full  agreement with that sentiment. Jack-Nicholson-The-Departed.

As this video discusses, it is apparent that there are brokers who have succumbed to the temptation and financial incentives offered by unethical settlement factoring firms to sell the names and contact information of annuitants who have structured settlements through their firm. This first came to light when I was contact by an attorney who had a structured fee with my office and who was solicited multiple times by the same firm to sell her fee structure. As there was no possible way that the information was public knowledge as the cases were settled privately and her structured legal fee wasn’t part of the court record, the information only could have come from brokers who split the case with my office.

This is a huge breech of privacy and I believe not only violates professional ethics, but possibly privacy laws regarding the safe guarding of a clients financial information. It is a huge black eye on our profession and I fully expect that there will be more of it, not less of it as structured settlement professionals who are struggling with the recent down turn in our business look for ways to stay afloat financially by being part of these questionable deals.

Be sure of one thing, this is being noticed by the life markets and structured settlement brokers and the people who are involved in this will be exposed and I would not be shocked if they lose life company selling agreements as a result.

In short this is serious business and those involved need to stop immediately or risk the loss of their professional viability going forward.

Posted on July 4, 2011 .