The Structured Settlement Watchdog John Darer has documented unfair, deceptive, and abusive factoring acts and/or practices for almost 20 years as part of extensive and ongoing efforts to educate both structured settlement annuitants and investors in structured settlement receivables.
- Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews: Factoring Company Bad Business Practices
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Acknowledging the unfair, deceptive, and abusive practices by certain members of the factoring industry purchasing structured settlement payment rights (the “Factoring Industry”), NSSTA has established the Fair Factoring Fund (the “FFF”) to protect vulnerable structured settlement payees and their families. While all fifty states and the District of Columbia recognize the risks posed by the Factoring Industry and have enacted a Structured Settlement Protection Act (“SSPA”) to regulate and set conditions on the transfer of structured settlement rights, these SSPAs have fallen short in effectively preventing and addressing the predatory behavior of some members of the Factoring Industry.
What will The Fair Factoring Fund do?
1. Promote the protection of structured settlement payees from predatory conduct
2. Focus on raising funds exclusively for lobbying at the State level in favor of legislation to protect annuitants from factoring company abuses.
What Will the Funds Raised by the Fair Factoring Fund be used for?
The funds raised by the Fair Factoring Fund will allow NSSTA to focus on regulations seeking to protect:
- cognitively impaired structured settlement payees,
- payees between the ages of 18 and 25.
- as well as protecting the disclosure of minor’s settlements and
- enacting regulations providing oversight of factoring transactions
Chris Bua of Bua Settlements, who is also President of the Society of Settlement Planners, writes that he believes the best course of action would be for annuity providers to offer a flexible hardship program with a predetermined discount rate similar to their commutation at death terms. A notice of hardship conversion has already been presented in PLR 201435006 and was found not to invalidate a proper IRC 130 assignment.