Written by Rhonda Bentzen
I was shocked that we recently got an invitation to join the National Association of Settlement Purchasers (NASP), the factoring industry’s trade group. After all, I’ve been a pretty vocal critic of their members’ shenanigans for years. I admit that the prospect of being given the opportunity to voice my ideas to the group on needed industry ethics reforms was quite enticing. Plus, I support the fact that factoring definitely needs a trade association to deal with industry issues that crop up. I’m also appreciative of the fact that NSSTA actually cooperates with NASP to address many of these issues, particularly when it comes to state statutes. I’d like to work on making that cooperation even greater. I even agree with NASP’s code of ethics and what they’ve been saying lately about the need for transparency and doing right by annuitants.
Now, for reasons, I’m not prepared to join just yet. To start, contrary to all the positive statements in their press releases lately, I believe almost everything NASP says and does these days is just lip service: rhetoric they think the structured settlement and legal communities, investors, the media, and government regulators want to hear. I haven’t seen any evidence to the contrary. Adherence to their code of ethics, along with consequences for its violation, are a complete joke. If they actually enforced their code of ethics, I believe few to none would be left in the organization. Members are currently being sued for alleged forum shopping and coercion. Another was implicated in the recent Baltimore lead paint scandal. Another recently settled a lawsuit involving the claimed falsification of an annuitant’s signature to initiate extra lottery transactions. A different firm was recently sued for allegedly calling an annuitant nearly 50 times in violation of the Telephone Consumer Protection ACT (TCPA). Yet another is now involved in a class action suit for alleged violations of the TCPA. One firm is even involved in a whistleblower suit alleging money laundering and serious breaches of banking laws. Even our survey of past clients found that most complaints related to incessant telemarketing harassment and deceptive sales tactics were directed at NASP members.
My other pause at joining the organization is that it’s not really inclusive, like NSSTA. I was easily able to be a NSSTA member even though I was a small producer in a tertiary market. Not with NASP. The cost to join NASP is prohibitively high, making it more of an exclusive cabal of the big “cash now” operators. This means that the few referral-driven, client-focused firms that actually do a good job of factoring are priced out of the association. As such, we have no say or vote whatsoever in planning and deciding the direction of the industry; however, based on their record, I honestly believe that NASP has no interest in hearing our input on best business practices anyway.
Done right, factoring can be a legitimate option for some annuitants in need of liquidity, and judging by their code of ethics and recent press releases, NASP members actually do know what they should be doing to treat annuitants fairly. Getting their members to actually do it is the hard part. Ultimately, annuitants simply need the facts and options to make informed decisions about their money, even if it means no transaction at all. They don’t need pressure, they don’t need harassment, they don’t need coercion, and they definitely don’t need to be endlessly solicited into repeat transactions…all of which are in the playbook of most NASP members today.
The Pollyanna in me says that I can’t affect change without joining; however, the realist in me says that I’d be naïve to think that I could make the slightest difference at this juncture when I can’t see any sign that NASP members are actually serious about reform and adherence to their code of ethics. I’ve spent 14 years in this business doing things differently; therefore, I concluded that my firm simply cannot be associated with a group that that approves of, or turns a blind eye to, everything I oppose. So, if you’re referring clients to any of these NASP-affiliated firms listed below, maybe it’s time to reach out to them and ask why nothing seems to change within their organization? Better yet, perhaps it’s time to stop supporting members of an organization which apparently refuses to effectively deal with questionable ethics and shady business practices?
123 LUMPSUM, LLC – 3625 Broward Blvd, 2nd Floor, Fort Lauderdale, FL 33312
Annuity Transfers Ltd. – 1800 Preston Park Blvd., Suite 115, Plano, TX 75093
BofI Federal Bank – 4350 La Jolla Village Drive, Suite 140, San Diego, CA 92109
CBC Settlement Funding – 181 Washington Street, suite 375, Conshohocken, PA 19428
Client First Settlement Funding – 301 Yamato Road, Suite 3200, Boca Raton, FL 33496
DRB Capital – 1625 South Congress, Suite 200, Delray Beach, FL 33445
J. G. Wentworth – 201 King of Prussia Rd, Suite 200, Wayne, PA 19087
Liberty Settlement Funding, LLC – 16 NE 4th Street, Suite 210, Fort Lauderdale, FL 33301
MyLumpsum LLC – 1400 Centrepark, Blvd, Suite 960, West Palm Beach, FL 33401
Northeastern Capital – Empire State Building, 59th Floor, New York, NY 10118
Novation Capital – 1641 Worthington Road, Suite 410, West Palm Beach, FL 33409
Patriot Settlement Resources – 2799 NW Boca Raton Blvd, Suite 111, Boca Raton, FL 33431
Peachtree Settlement Funding – 201 King of Prussia Road, Suite 320, Radnor, PA 19087
Seneca One, LLC – 7920 Norfolk Avenue, Suite 300, Bethesda, MD 20814
Settlement Capital Corporation – 14755 Preston Road, Suite 610, Dallas, TX 75254
Singer Asset Finance Company, L.L.C. – 2255 Glades Road, Suite 118E, Boca Raton, FL 33431
Stone Street Capital, LLC – 7316 Wisconsin Avenue, Suite 500, Bethesda, MD 20814
Strategic Capital, LLC – 100 Sheppard Ave East, Suite 720, Toronto, Ontario, Canada
***This list was compiled from the NASP website.