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    Department of Justice Asked to Probe of Structured Settlement Buyouts

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    Posted on September 3, 2015 To

    The Washington Post today reports that Democratic Reps. Chris Van Hollen (D-Md.) and Rep. Louise Slaughter (D-N.Y.) have asked U.S. Attorney General Loretta E. Lynch to open an investigation into “whether companies that purchase settlement payment rights have violated federal law amid mounting criticism that some deals have taken advantage of vulnerable residents in poor, urban communities. ‘Our goal is to have the Attorney General’s office take a deep dive into these practices and expose wrongdoing, because clearly we have a situation where people are preying on individuals who have already been victimized,'” the lawmakers said in a letter to Lynch last week.

    Van Hollen and Slaughter “are the latest to press for increased scrutiny of companies that purchase settlement payment rights following a report in The Washington Post that detailed how some deals have doled out dimes on the dollar to lead-paint poisoning victims who are poor and mentally disabled,” according to the story. The Washington Post story, written by Terrence McCoy, reported that the structured settlement industry, that began in the 1980s, had few restrictions. Over the years, some states have passed laws, but Van Hollen was reported as questioning the effectiveness of those laws today. “Lawmakers ask attorney general to probe structured settlement buyouts,” Sept. 1, 2015.

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    McCoy also reported that Slaughter said this isn’t a local issue because it can have national consequences. “‘When the victims run out of that [lump-sum] money, then the rest of us have to pick up the slack,’ she said. ‘It’s another way they’re forced onto public assistance.'” The congresswoman said that she is awaiting a response from the Attorney General’s office.