by Structured Settlement Watchdog
What is a Structured Settlement Short Payment Scam?
A short payment scam is like a bad soap opera plot, where someone working for a buyer of structured settlement payment rights aggressively bombards a structured settlement annuitant with letters, emails, or texts, claiming they’ve been “shortchanged.” The goal? To spark a whirlwind of panic and fear, prompting the recipient to call a toll-free number for “help.” Spoiler alert: the so-called help inevitably involves selling more payments and chipping away at their financial security.
The Short Pay Scam Letter, Made to Look Official, Targets Annuitants to “Unsettle” Them
A confusing and seemingly official communication has been circulating, referencing IRC 5891, a section of the federal tax code that imposes an excise tax on structured settlement payment buyers under certain conditions.
This morning, I received two calls from a woman in Greenville, SC, who reported receiving such a communication. She has a structured settlement that was established in 2021. I have notified the Greenville SC police department regarding this matter.
Avoid Short Payment Scams and Other Phishing Chicanery
- You do not have to register your structured settlement anywhere.
- Solicitations from fake entities such as a “structured settlement registry”, “structured settlement accounting department” are frauds. Ignore them.
- It may seem like common sense, but avoid engaging with any entity that sounds like a restaurant chain or a food group (e.g., Joe’s Rib Shack LLC, Dos Nachos (who can only have two?), Chicken Little’s Drivel LLC ). For a balanced fiscal and physical diet, keep your food groups and your finances in separate lanes—LOL.
- Shy away from a company whose website has just a contact form and no address.
- Shy away from companies that use a P.O. Box as their primary address.
- Always seek independent professional advice.
Resources for Greenville SC residents about Identity Theft
SC Department of Motor Vehicles | Dealing with Identity Theft