Dallas, TXWaco-based financial company Life Partners did not play fair with investors and is guilty of both breach of contract and breach of fiduciary duty, according to a class-action suit filed by Dallas attorney James Craig Orr from the firm of Heygood, Orr & Pearson. If the allegations prove true, hundreds of people who bought something called "life settlements" investments from the company are likely owed thousands and thousands of dollars.
Life settlements, as explained on the Life Partners Web site, are investment vehicles that "allow people to turn unwanted life insurance policies into cash."
Essentially, life settlements are investments whereby a policyholder sells his or her life insurance to someone else for immediate cash. The new owner agrees to pay the premiums, and when the original owner dies, they collect the full value of the policy.
Although the Securities and Exchange Commission recently suggested life settlements need to be more clearly defined to protect consumers, life settlements are increasingly popular and perfectly legal financial instruments.
However, in the suit against Life Partners, based in Waco, Texas, investors who bought fractional amounts of "universal life insurance policies," a kind of life settlement that builds in value over time, allege they were asked to pay higher than necessary premiums on their investments.
As a result, the money in the escrow account set aside by Life Partners to cover the costs was depleted.
"Every other life settlement company that I am aware of only has their customers pay the minimum amount necessary to keep the policy from lapsing," says Orr, "but Life Partners has been paying the whole plan premium. Why we don't know. We are going find out in this lawsuit."
Jim Craig Orr is a partner in the firm of Heygood, Orr & Pearson. His practice focuses on complex business litigation and catastrophic personal injury cases. He has taken more than 70 cases to trial and achieved substantial financial recoveries for his clients. He is a graduate of the University of Michigan Law School.
I purchased 8 policies for $88,000.00 in early 2009. Not a one has paid off. My wife and I have already paid over $20,000.00 in premium payments and now LPI wants a yearly monitoring fee. These things are actually leading us to the poor house. What's bad is that after we had purchased these we found out that there were 2 sets of numbers on the life expectancy. We were not asked if we would like our money back. I hope the people at LPI can live with there self for taking advantage of people. I would just like to get my initial money back. I will seek legal help and would like to be named in the Class Action Suit against Life Partners.
Posted by Rick Ellis
I purchased $145,000 worth of policies in 2010. I am now paying premium lapses as well as paying a bill I received stating that if I don't pay this additional fee, that LPI won't likely be able to monitor my purchased accounts any longer. This is very frustrating. Don't threaten to not be able to monitor the products I purchased without giving me the option to monitor them myself.
Posted by Steve Jessup
I purchased 7 Life settlement policies in 2008 from Dan Levine located in Dallas. All seven policies are well passed the life span projections and of course I am now paying premiums on all seven contracts. I am seeking legal advice.
Posted by Sean Lucart
I purchased 5 Life Settlements in 2010 from Dan Levine Financial located in Dallas. As of 2015, not a single insured has died. I, along with other investors, now must pay exorbitant premiums to keep my 5 Life Settlements from lapsing.
I am seeking legal help and would like to be named in the Class Action Suit against Life Partners.
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