Edward Stone – Guest Speaker at Association of BellTel Retirees 2018 Annual Meeting

Edward Stone, Special Counsel to ProtectSeniors.org was a guest speaker at the 2018 annual membership meeting of the Association of BellTel Retirees in Atlantic City, New Jersey on June 6, 2018.  Mr. Stone’s presentation on pension derisking offered retirees information on the status of state legislative initiatives in New York, New Jersey, Virginia, Massachusetts, Pennsylvania, and Connecticut.  Stone stressed to the retirees the importance of taking action now to protect their retirement benefits. Retirees lose all federal protections provided by the Employee Retirement Income Security Act (ERISA) and the Pension Benefit Guaranty Corporation (PBGC) in a pension derisking transfer.  Protections that are lost include: uniform protection from creditors and bankruptcy trustees; ERISA’s fiduciary duty standards; mandated annual financial disclosures; minimum funding thresholds; ready access to the federal courts; and PBGC coverage.  State legislation must be enacted to replace the protections that have been lost.  If you would like more information on pension derisking, please contact Edward Stone Law at admin@edwardstonelaw.com.

 

Virginia Pension Derisking Legislation – Effective as of July 1, 2018

Virginia is the latest state to enact legislation protecting retirees in pension derisking transfers.  Senate Bill SB755 introduced by Senator Glen Sturtevant (R-Midlothian) with support from Delegate Dawn Adams (D-Richmond) received unanimous support in both the Virginia House and Senate.  Virginia law now provides that (1) amounts payable to a participant under an annuity providing retirement benefits are exempt from creditors’ claims, and (2) subsequent transfers of group annuity contracts funding retirement benefits are prohibited without the prior written approval of the State Corporation Commission.  Amending Section 38.2-3125 of the Virginia Code, this new legislation went into effect on July 1, 2018. The complete text of SB755 is available here: SB755.

Lawsuit Filed in the Wake of MetLife’s Failure to Keep Track of Retirees

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Earlier this year we reported on MetLife’s failure to pay retirees to whom it owed benefits resulting from pension de-risking transfers.  A lawsuit has now been filed against MetLife by Edward Roycroft, a former Martindale-Hubbell employee who retired in 1999.  Roycroft was supposed to receive his benefits in 1999, but MetLife did not pay him his benefits until 2013.  Styled as a class action, the lawsuit includes claims of conversion and unjust enrichment and alleges damages to the class in excess of $500 million. The case is styled as Roycroft v. MetLife, Inc., 18-cv-05481 (S.D.N.Y.).  The Commonwealth of Massachusetts, Securities Division, has also charged MetLife with fraud for making materially misleading statements in public filings causing harm to investors.

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.