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JG Wentworth Sued Over Attempts To Defraud And Harm Consumers, And Restrict Competition
JG Wentworth parent JGWPT Holdings and its president David Miller have been sued for colluding with competitors to fix prices in a recently filed lawsuit.
According to Paul McHugh, spokesperson for industry watchdog The Structured Settlement Institute, “This JG sponsored collusion agreement is anti-competitive, unlawful, and is directly at odds with the underlying purpose of the Structured Settlement Protection Act, which regulates the sale of structured settlement payments in order to protect consumers. Peachtree and Wentworth are at the heart of this collusive agreement.”
“Participating in an agreement not to compete – especially one promoted by JLL Partners portfolio company, JGWPT, LLC which controls an estimated 65% of the market – serves to promote the financial gain of Wentworth and Peachtree at the expense and integrity of the whole industry,” says McHugh. In contrast, other factoring companies compete openly and freely with Wentworth, Peachtree and NASP member firms in the secondary market for structured settlement payment rights. RSL Funding, among a few other companies that have not joined this alliance, declined to engage in what it believes is illegal, anti-competitive conduct, an unreasonable restraint of trade and a deceptive trade practice.
RSL Funding is one of the few companies willing to make competitive offers to annuitants who have tentatively decided to sell their structured settlement payment rights. RSL actively pursues sellers of future income streams from settlement recipients in exchange for a lump sum payment and for the most competitive price.
"Smart customers shop rates. Judges question customers to ensure that the customers are getting a fair deal by requiring evidence of competitive shopping," commented Stewart Feldman, who has long been active in the structured settlement factoring industry. Feldman cited RSL as offering among the best rates in the industry, with Wentworth affiliate, Peachtree, and Imperial offering among the least value.
JG Wentworth and Peachtree today are controlled by New York private equity fund JLL Partners. JLL Partners’ operations have recently experienced a series of setbacks in the courts where they have tried to pursue anti-consumer practices. Wentworth’
“What appears to be a competitive bid is really an illusion,” says McHugh. In response to the actions of Wentworth affiliates to dominate the market, a Texas court recently upheld the right for RSL Funding, LLC to offer former Wentworth clients more money for their future payments2 and to be free of claims for doing such. Repeated inquiry to counsel for JG Wentworth and Peachtree, L. Bradley Hancock, a partner in Greenberg Traurig’s Houston office, resulted in a demand that this information not be publicly disclosed.
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1 Case No. 2006-23366, 113th Judicial District Court, Harris County, TX
2 Case No. 2009-78934, 334th Judicial District Court, Harris County, TX
For further information, contact the Structured Settlement Institute (SSI), a not-for-profit organization established to educate sellers of structured settlements regarding fair and equitable practices among providers of structured settlement transfers.
Structured Settlement Institute
Boynton Beach, FL
Page Updated Last on: May 02, 2012