A. Ethics Concerning Solicitation and Creation of Structured Settlements

Structured Settlement Affidavit and Structured Settlement Declaration

4structures.com, LLC is one of the only structured settlement brokerage and consulting firms that offers transparency and protection from fraud and misrepresentation through a Structured Settlement Affidavit ("SSA") or Structured Settlement Declaration ("SSD"). The SSA or SSD maintains the integrity of the structured settlement process, provides a full disclosure of terms, and carries all penalties for perjury.

Why do we offer the SSA and SSD?

1. Certain business practices, or allegations of certain business practices, undermine consumer confidence in the settlement process thereby hurting both the consumer and those casualty insurers who do not engage in these alleged practices that may be unethical, perceived as unethical, or even illegal. We are committed to protect the integrity of the process as everyone ultimately benefits from an honest system.

2.  It is well established in two IRS Private Letter Rulings that knowledge of the structured settlement cost does not put the payee in constructive receipt and does not affect the income tax exemption afforded to structured settlement recipients. Several states require cost disclosures as part of their structured settlement protection acts. Yet from time to time one still encounters a level of ignorance on the topic.

3. Most states have legal and regulatory prohibitions against rebating or "pay to play" schemes. Yet for years it was common knowledge that such regulations were ignored as some structured settlement brokers, or their firms, paid a part of their commission to their casualty insurer clients, or even to plaintiff lawyers! Although tied to a percentage of commissions earned by the broker, such arrangements have been called "service fees" or "administrative fees". Our position is that these were transparent attempts to avoid anti-rebating laws on the books in most states. While it is rare to encounter such behavior today the fact that there is any perception by some in the plaintiff’s bar that it still exists is reason enough to address it.

4. A factoring industry intermediary published a statistic in December 2007 that an astonishing 90% of its structured settlement broker clients were taking compensation for essentially doing little more than referring structured settlement annuitants to it. Such compensation and "service provided" was not readily transparent in many of these folks marketing materials, particularly websites. We continue to ask the simple question of "Why?" It is well established by factoring industry sources that such compensation reduces the amount that a tort victim receives at a time they are most desperate and have exhausted all other forms of financing. Put another way those desperate souls have to sell more of the payments that provide their financial security just because of the compensation paid. A structured settlement transparency initiative was supported by only 5% of the industry. While the intermediary in question has withdrawn the written 2007 disclosure about the aforementioned 90% figure from where it was published and, indicated in late 2009 without specificity that the percentage has been reduced, it is clear that the practice continues.

Our Practice

The Structured Settlement Affidavit (notarized), or Structured Settlement Declaration, is a series of affirmative representations and warranties issued in writing for a case on which we are involved. These certify among other things that we:

• Do not pay commission rebates to any party or insurer, or evade the anti-rebating statutes through "service fee" or "administrative fee" arrangements
• Fully disclose age ratings and never misrepresent the cost of a structured settlement by engaging in post settlement medical underwriting
• Always disclose the true cost of the structured settlements that we participate in or negotiate, regardless of whether or not there is a statutory obligation to do so.
• Do not attempt to artificially inflate the value of any settlement by using unrealistic present value calculations
• Are not an "in house" or captive broker owned or controlled by an insurance carrier

Insist on the Structured Settlement Affidavit or Structured Settlement Declaration

All parties and the courts can feel comfortable that the facts and the numbers are indeed as they are represented when we handle, or participate in the handling, of a case. The warranty section of the SSA or SSD would expose us to civil and criminal liability if any statement were false.

Sample Structured Settlement Affidavit click here

1. participate financially or take compensation for referral of selling annuitants to companies that broker, or fund, structured settlement factoring transactions;
2. sell, nor intend to sell lists of names of structured settlement annuitants to companies that broker, or fund, structured settlement factoring transactions;
3. provide, nor intend to provide, structured settlement documents to factoring companies.

As of October 31, 2010, 4structures.com, LLC is one of only two firms dealing with structured settlements, or litigation recovery management for tort victims that have a posted public policy on this subject.

4structures.com, LLC's John Darer and G. Mark Morley are listed on the Structured Settlement Clean Vendor List. How about your structured settlement consultant, settlement planner, or litigation recovery management expert?