Prudential Loses Track of Annuity Clients

Prudential Financial Inc. has reported that it has lost track of some of its annuity clients.  This announcement comes on the heels of MetLife’s announcement in December, 2017 that it had lost track of about 30,000 people to whom it owed pension payments as a result of pension de-risking transfers.  According to BloombergMarkets, Prudential will also take a charge tied to losing track of its customers.

If you are a retiree who believes you are missing payments from Prudential, please contact us at eddie@edwardstonelaw.com or (203) 504-8425.

 

 

Annuity Sold – Structured Settlement Factoring Scam

On January 8, 2018, Maryland Attorney General Brian E. Frosh announced that Maryland’s Consumer Protection Division had entered into a settlement resolving an investigation into  deceptive marketing  practices by Annuity Sold, LLC and its many affiliated companies:  Uber Funding,LLC; Bendermere Capital Solutions, LLC; Axis Funding, LLC; Stonebridge Capital, LLC; Greenspring Funding, LLC; LSG, LLC; Preak Street, LLC; ILILIL2010, LLC; Palantir Packaging, LLC; and JRR Funding, LLC.  Annuity Sold and its affiliates were in the business of purchasing structured settlement payment streams for lump sums.

The deceptive marketing practices employed by Annuity Sold and its affiliates included letters written on behalf of a fictitious judge and a fictitious law firm, letters containing the logo of the Baltimore Ravens football team, letters stating that the recipient qualified for a zero percent interest loan, and letters from non-existent insurance companies.  An article in The Baltimore Sun reported that Annuity Sold disagreed with the allegations, but settled “to avoid the cost and uncertainty of litigation.”

Annuity Sold and its affiliates have been banned from doing business in Maryland for seven (7) years,  ordered to pay civil penalties, and make restitution to annuitants who sold their structured settlement payment streams to Annuity Sold and its affiliates.

Maryland has one of the strongest structured settlement protection acts, and Attorney General Frosh has taken a strong stand against deceptive practices in the structured settlement secondary market.  Earlier posts on this subject can be found here, and here.

 

 

“Concussion Protocol”

If you weren’t worried about concussions before,  “Concussion Protocol“, directed by Josh Begley of The Intercept and produced by Laura Poitras should do it for you.  The masterful film contains footage of each concussion reported during the 2017-2018 NFL season. 281 reported concussions – the most reported in the past 6 years. The NFL Concussion Settlement is lacking in many ways, but hopefully the one good thing that will come out of this lawsuit is more attention paid to concussions at every level of play – from Pop Warner to the NFL, and every sport from football, hockey, baseball, soccer, lacrosse.

Structured Settlement Fraud Continues

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Fraud in the structured settlement secondary market appears to continue unabated. One of the latest scams seems to involve transfer companies that obtain court orders authorizing an annuitant to sell his/her periodic payments, and then the company fails to pay the seller.  The seller is then faced with chasing down the company or figuring out a way to go back to court and have the court order set aside.  This situation is exacerbated by fly by night companies with no track record and no real business.

Not one of the 49 state structured settlement protections statutes allows a company to obtain a court order authorizing the sale of periodic payments and then fail to pay the Seller.  This is fraud. Plain and simple.

If you are a “Seller” and did not receive payment pursuant to a transfer order, please contact us at (203) 504-8425 or via email at eddie@edwardstonelaw.com.

MetLife Fails to Pay Pensions

In December, 2017 MetLife revealed that it had failed to pay approximately 30,000 people to whom it owed benefits resulting from pension de-risking transfers. Now, the Securities Exchange Commission (SEC) is looking into this failure to pay pensions.  MetLife is also facing inquiries from several state insurance regulators, including the Superintendent of Financial Services in New York.  MetLife shares took a hit after the company postponed its earnings report due to these unpaid pensions. While MetLife has claimed to be unaware of any intentional wrongdoing in connection with its failure to make payments to these people, this reinforces the need for legislation to protect retirees impacted in pension de-risking transfers. More information on Pension De-Risking can be found here.

If you are a retiree who believes you are missing payments from MetLife, please contact us at eddie@edwardstonelaw.com or (203) 504-8425.

Association of BellTel Retirees Chairman Speaks Out on Pension De-Risking

In a recent interview with PlanSponsor, Jack Cohen, Chairman of the Association of BellTel Retirees, spoke out about the need for protections for retirees in pension de-risking transfers.  “It’s really an unfortunate picture, but we also have to be realistic and keep working hard,” Cohen concludes. “I know that de-risking is a phenomenon whose time has come. But this does not mean we should stop asking questions and stop working to make risk transfers the best we can for retirees. We have to wonder if the insurance companies can stand to take all that risk, and how they will manage it. What we are concerned with is trying to recoup at least some of the protections that we had under ERISA. We are not looking for pie in the sky—we’re looking for Congress and the state legislatures to recognize this could become an economic disaster if we do not protect peoples’ pensions.”

In 2012, 41,000 Verizon retirees were removed from the Verizon pension plan when Verizon purchased a group annuity contract from Prudential to replace the pension benefits for these retirees.  A subsequent legal challenge to the transfer by the Association of BellTel Retirees was ultimately unsuccessful, but the challenge brought much needed attention to the risks facing retirees in pension de-risking transfers.  In late 2015, Connecticut became the first state to pass legislation protecting retirees in pension de-risking transfers. Bills are now pending in New York, Pennsylvania, and Virginia which would replace some of the protections lost to retirees who reside in those states.

 

New York – Pension De-Risking Legislation

On January 3, 2018, Assembly Bill, A7071 – AN ACT to amend the insurance law, in relation to providing protection to certain retirees from pension de-risking transactions; and to amend the civil practice law and rules, in relation to statutorily exempt payments – was referred to the Insurance Committee.  This is the first step in working towards the enactment of legislation to replace some of the protections lost to retirees in pension de-risking transfers.  This bill is sponsored by Senator Tony Avella and Assemblyman Peter Abbate.

International Paper Continues Its Pension De-risking

In early October, 2017 International Paper continued its pension de-risking, transferring approximately $1.3 Billion in pension liabilities to Prudential Insurance Company of America through the purchase of a group annuity contract.  This purchase impacted 45,000 retirees and beneficiaries.  This followed on the heels of an offering of a lump sum buyout in 2016 to 47,000 former employees who had yet to retire.  The Consumer Finance Protection Board has published a guide to help those considering accepting a lump-sum payout.

Article by Edward Stone in The Journal of Legal Nurse Consulting

Attorney Edward S. Stone helps explain some of the difficulties surrounding the NFL Concussion Settlement in this article “The NFL Concussion Settlement, Traumatic Brain Injury, and CTE: Fact, Fiction, and Spin Doctoring”.  The Journal of Legal Nurse Consulting Vol. 28, Issue 3, Fall 2017, pp. 8-11.  Meanwhile, medical researchers continue to explore new ways to ascertain brain damage, including the possibility of using blood tests to detect concussions.  More on this can be found in this article in The Guardian – “NFL concussion: researchers hope blood tests can better detect head trauma.”

New York Times transfers $225 million in pension liabilities

On October 24, 2017 Pension & Investments reported that the New York Times Co. would purchase group annuity contracts from Massachusetts Mutual life Insurance Company to divest itself of $225 Million in pension liabilities under two of its defined benefits plans. This transfer reportedly affects 3,800 retirees and/or their beneficiaries. MassMutual is scheduled to take over the payments to retirees on January 1, 2018.