Going back on time, 30 years ago, because of the good intentions of a bipartisan coalition of Senators Charles Grassley (R-Iowa) and Max Baucus (D-Mont) there was a positive change as far as accident victims are concerned. The product which came out was structured settlement which offered guaranteed income stress, free from tax instead of lump sum payments. While the intentions were good, today many structured settlements have lead to financial swindling and deception. It is sad that recently around 1,500 accident victims and others with disabilities found them losing almost a billion dollar as far as future promised payments were concerned.
I belong to one such group. My husband was killed in an automobile accident for no fault of his. I was one fine day left alone fending for me and my three little children. As a defense I was given a structured settlement payment as compensation. It was more like a take it or drop it kind of an offer. I was not given an opportunity to negotiate and was also not given the liberty of choosing the insurance company which would be taking care of my lifetime payments. The insurance company in question Executive Life of New York, went bust recently. This has resulted in my structured settlement payments being trimmed by almost 60%. My entire life has gone for a toss and my emotional suffering is very severe to say the least. On the other hand, the broker who worked out the structured settlement went home happy with a huge brokerage fee and is not ready to accept responsibility for what has happened to me.
Given the above situation it is important that Congress takes note of it and investigates this fraud and deception. It certainly has caused immense hardship and harm to me and I am sure there could many others who could be suffering from this situation and many of them could be people with disabilities. The first work should be to investigate the biggest structured settlement companies, EPS Settlements and Ringler Associates. Both these companies pocketed undisclosed commission for putting in place the structured settlements.
The problems created now were because of their actions. It would be pertinent to mention that Executive Life perhaps was not authorized or licensed to operate in many states where there is a concentration of annuities. I live in Texas for a long period of time and I realized later that this insurance company does not have a registered office here. Hence over dozen Guarantee Associations whose job was supposed to protect insurance customers, as is being done by FDIC, did not do what was expected of them.
There is one more example which goes to prove that the odds are heavily stacked against those who are accident survivors. The DC based trade association has quite a few things to explain. It has boasted and blown its trumpet as an organization which supports people with injuries and disabilities. However, for more than ten years having known about ELNY’s financial problems, it did nothing to warn innocent and gullible customers like us.
Two class action suits have been filed against various structured settlement companies and more such lawsuits are on the way. According to Edward Stone who is an authority in settlement law states that allowing insurance agents to sell a structured settlement which is unregistered to accident victims is dangerous especially when these people are financially very weak and brittle. The practice of hiding facts from investors is a very bad and shameful thing to do.
Grassley who was instrumental in coming out with a new tax code change which gave a new direction to structured settlement has a record of focusing carefully when it comes to investigating financial deception. It would be pertinent to mention here that James Langevin (Republican) was the only paraplegic to have ever served in Congress. He chose a structured settlement after suffering a spinal injury. Hence both these officials and other leaders such as Sens. John Cornyn and Elizabeth Warren must investigate and expose the fact that structured settlements could have today become a billion dollar fraudulent business fooling many innocent people
Congress must not be aware that the system which it created to help accident and injury victims, would come back to haunt these victims and ruin their lives completely. It is high time that Congress woke up and investigated the matter.