by Structured Settlement Watchdog™
My previous post on the subject of certain structured settlement brokers approaching factoring companies and offering structured settlment annuitant lists for money has stimulated some discussion. The source of our information came from the factoring industry. I've now heard this from more than one source.
In response to my previous post. one insurance company executive called me and stated to this author that each of the brokers in its program signs a confidentiality agreement.
If they fail to abide by the agreement, for example by doing what is described above and in the previous post, the broker faces termination from the program at the very least. Furthermore the broker's firm may face termination from the program as well.
One of the tenets of our business is confidentiality. To wit:
"A NSSTA member will not disclose confidential information to unauthorized persons except with the specific consent of the source thereof, or in response to proper legal requirements or court orders.To promote structured settlements and to strengthen NSSTA, its members will hold in strict confidence the confidential, sensitive and private information given to them. NSSTA members must not reveal information agreed to as confidential without the expressed consent of the source thereof or pursuant to legal requirements (such as statutory authorization, subpoena, or court order)". Source: Code of Ethics National Structured Settlement Trade Association (NSSTA)
"A settlement planner shall not disclose, use to the client’s disadvantage, or use to the advantage of the planner or a third person, confidential information obtained in the course of or as the result of the planner’s provision of services to the client, unless: the client gives informed consent, the disclosure is required by the law, or the disclosure is impliedly authorized by the client.
A settlement planner shall act competently to prevent inadvertent or unauthorized disclosure of client information protected by paragraph (a), including providing for secure storage or destruction of such information during and subsequent to the provision of services to the client.
A settlement planner shall make reasonable efforts to have in effect measures giving reasonable assurance that the planners’ employees will comply with the duty of confidentiality imposed upon the planner by this Rule" Standards of Professional Conduct for Settlement Planners, Registry of Settlement Planners and Society of Settlement Planners
A number of insurance executives say the alleged reckless behavior does not surprise them . In tough economic times some get desperate and are tempted , but that does not make it right. For those that are doing it for their own selfish reasons, I hope that they are reading this blog. They need to rethink what they are doing or face possible curtailment of future opportunity for themselves and others in their firm
Structured settlement annuity issuing life insurance companies have significant exposure because they have a mandatory obligation of compliance with the Gramm Leach Bliley Act's Financial Privacy Rule
(see Disclosure of Nonpublic Personal Information, codified at 15 U.S.C.§§ 6801–6809)
The financial privacy rule provides for a privacy policy agreement between the company and the consumer pertaining to the protection of the consumer’s personal nonpublic information.The Financial Privacy Rule requires financial institutions to provide each consumer with a privacy notice at the time the consumer relationship is established and annually thereafter. The privacy notice must explain the information collected about the consumer, where that information is shared, how that information is used, and how that information is protected. The notice must also identify the consumer’s right to opt out of the information being shared with unaffiliated parties pursuant to the provisions of the Fair Credit Reporting Act. Should the privacy policy change at any point in time, the consumer must be notified again for acceptance. Each time the privacy notice is reestablished, the consumer has the right to opt out again.
The possibility that an individual or entity is offering for sale, details concerning more than one annuitant (who presumably has received GLB compliant privacy notices), none of whom are aware that their information is being sold, with an intent to profit from this information by soliciting payment from a factoring company should not be tolerated
Let's be clear again, we're not speaking about a single referral from someone who has made their desire to sell structured settlement payments known. We are speaking of the offer for sale of details concerning more than one annuitant (who presumably has received GLB compliant privacy notices), none of whom are aware that their information is being sold, with an intent to profit from this information by soliciting payment from a factoring company. Good thing the aforementioned "rats " don't live in Laos.
Source: Tien Chiu
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