Structured Settlements 4Real®Blog 2026

Not long after he won "financial jackals descended on him like raw meat" according to a quote attributed to his attorney, Harold H. Kutner, Jr. of Mineola, NY, in Long Island's Newsday at the time of original publication.

Bonilla started to receive phone calls and offers to sell his lottery payments for a cash lump sum. According to Newsday, Barbara Guerra, a spanish language speaker at Prosperity Partners, a company whose representatives appeared at the 2005 Society of Settlement Planners annual meeting (SSP), allegedly contacted Bonilla 16 times in one day! My readers know the players who buy lottery payment rights are the same factoring companies who contact people who are receiving structured settlement annuity payments (i.e. the "deep discounters"). According to a Newsday article, the cash offers he received were highly discounted and significantly less than the sum of the lottery payments he was scheduled to receive.

Mr. Bonilla who, according to Newsday could not read or write, sustained continual bombardment by these companies before succumbing to temptation to sell his secure $260,000 lifetime annual income to Prosperity Partners, Inc. for $2.23MM.

At the time the guaranteed lifetime payout was $4.55MM, so as a result of the sale of his lottery payment rights to 70 future payments for "cash now", he lost $2MM plus in future payments. To compound this, apparently Bonilla had been assured that the cash lump sum settlement that he received would not be taxed, but later he learned that a 50% tax would apply to the transaction.

Bonilla then attempted to pull out of the transaction. The factoring company which bought his lottery payment rights, Prosperity Partners, Inc  (a/k/a PPI Cash) then filed a breach of contract suit against Mr. Bonilla. The suit was eventually dismissed.

The end result for Bonilla ended up being favorable but his story highlghts the vulnerability of lottery winners and those who are suddenly wealthy. 

See Prosperity Partners, Inc. v. Bonilla (374 F.Supp.2d 290) – vLex United States   

Had this been a structured settlement the sale would have been subject to a court order that would have required the involvement of attorneys and financial advisers to determine if the sale was truly in Virgillo Bonilla's best interest.

Unfortunately for Virgillo Bonilla the New York Structured Settlement Protection Act ("SSPA") presently applies only to recipients of settlement payments for which underlying case damages qualified under IRC Sections 104(a)(1)and 104(a)(2).

Even that is not a perfect system as my readers have seen on this blog. But its better than nothing. It would be nice to see New York State and others offer a form of protection for lottery winners similar in nature to the Structured Settlement Protection Acts.

IF YOU HAVE ANY THOUGHTS ABOUT CASH NOW READ THIS

1. Factoring is a final decision. Don't count on the result that Bonilla got.
2. Get Independent Professional Advice from someone who is qualified and unrelated to the person or company buying your lottery payment rights, to assist you in your evaluation.
3. Don't be greedy! "Cash now" isn't always the best thing. Why wasn't Bonilla happy to live on what was probably a significant multiple of what he was previously earning? If he felt compelled to sell then why did he have to sell all of his payment rights?
4. There's nothing wrong with delayed gratification in this type of situation. As Bonilla has learned  the hard way, instant gratification often comes at a very very high cost.
5. Get on a budget even if you have all that money. Know the impact your spending habits have on your savings and income needs.

Newsday Nassau Suffolk edition 08/10/2005 starting page 3 and correction 12/18/2005 page A11, Rachel Leifer, Staff Writer