Factoring company business practices is a topic about which there appears to be greater awareness among the trial lawyers these days.
It may shock some plaintiff attorneys that some so-called "plaintiff exclusive" settlement planners and structured settlement brokers participate in structured settlement factoring transactions and are actually profiting in it at the plaintiff's expense.
This author would like to underscore that this is the exception rather than the rule. A number of factoring companies are advertising incentives to such persons to refer them business.
Examples
It is believed that between 2%-4% of the net amount being factored is paid to the referror "plaintiff exclusive" settlement planner or "plaintiff exclusive" structured settlement broker. And some of them ARE actually taking it! DO THE MATH! THIS IS MONEY THAT COMES RIGHT OUT OF YOUR CLIENT'S POCKETS! One person I spoke to suggested that the majority, but NOT ALL, of those planners or brokers that refer business to them DO take commissions. Whether it is legal or not, whether the amount in question is small or large, in my opinion, it's disgusting and disgraceful that the greed of a few is potentially harmful to plaintiffs and ultimately to the image of our industry. Once again, this author would like to underscore that this is the exception rather than the rule.
Patrick HIndert who introduced the SSP to factoring when he was Executive Director. and has never let go of his apparent mission to "fit the round factoring peg into the square structured settlement hole". Hindert is a respected structured industry scholar and author of the structured settlement "bible" . Today the Hindertstan "bible" is becoming less holy and, in my opinion, Hindert is losing his industry standing because of his rampant promotion of factoring and JG Wentworth in particular. One party at today's NAMSAP meeting related a story about encountering Hindert at the Academy of Special Needs Planners meeting where he was "pimping'" JG Wentworth. A similar cloud was reported about Hindert about his actions at the SSP annual meeting.
What is your settlement planner or structured settlement broker's factoring policy? How front and center are they?
Some factoring companies also appear to pay referral fees to lawyers. Worse yet there are law firms who have links to factoring companies on their law firm web sites.
These Florida law Firms have links to the factoring company Strategic Capital. Fine law firms, BUT what message do they send? Especially when the annuitants could be seduced by the opportunity to win a trip to Hawaii?
http://www.strategiccapital.com/strat_how_lawyers.asp
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