On February 6, 2006 915am PST DealFlow Media posted a story which suggests that a heightened level of scrutiny could come to the structured settlement industry in 2008 with the Security and Exchange Commissions approval of NASD Rule 2821. While DealFlow admits that the rule does not directly affect structured settlements, it claims that there is a potential to be aimed at structured settlements brokers, but states no jurisdictional basis.
Rule 2821 was designed to curb salepractice abuses in deferred variable annuities. While a variable income structured settlement annuity is available from one annuity issuer through selling agreements with appointed broker dealers, sales of it have been miniscule due to inflexibiility in product design. Virtually all structured settlements are of the fixed variety, where the "qualified funding assets" are annuities or treasury bonds.
Once again DealFlow Media demonstrates a lack of understanding of the structured settlement industry when it talks about "registered principals" personally reviewing each application. The simple placement of structured settlements involves licensed insurance intermediaries who are subject to regulation by State Insurance Departments, not the SEC.
A registered principal is an officer or manager of a FINRA (formerly NASD) member, who is involved in the day-to-day operation of the securities branch office.
On another topic, the DealFlow Media report posted on The Structured Settlements Wire on February 8, 2008 at 1pm concerning the NSSTA Executive Director is not correct.
In a case of second impression DealFlow Media demonstrates that it is NOT a credible source of information on the structured settlement industry.
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