MINNESOTA [10/18/21]— U.S. Senator Tina Smith (D-Minn.) has urged the nation’s top financial regulator to probe firms that have aggressively targeted accident victims in Minnesota and across the country to give up injury settlements designed to provide them income over many years in exchange for a one-time smaller lump-sum payment – typically taking half the value of the settlement or more.
In a recent letter to Rohit Chopra, the Director of the Consumer Financial Protection Bureau (CFPB), Sen. Smith pressed for an investigation into the firms operating in the largely-unregulated industry that buys “structured settlements” from people who have been injured or are otherwise entitled to a settlement. In return, the thousands of Americans who have entered into these agreements after suffering an accident or another life-altering incident get a one-time payment that equals just a fraction of their settlements.
The result is that Americans who have suffered serious and permanent injuries are often left without critical resources needed to provide for themselves or their families, Sen. Smith said.
“According to the reports, firms buying structured settlement payments are unfairly depriving many individuals – often those who have suffered significant and debilitating injuries – of thousands of dollars in legal settlements, and in some cases, hundreds of thousands of dollars or more,” Sen. Smith wrote. “Buyers appear to be preying on vulnerable Minnesotans with unfair, deceptive, or abusive deals pitched by high-pressure sales staff, with those arrangements often leaving disabled individuals facing poverty after lump sum payments run short.”
Sen. Smith urged the CFPB to look into the industry’s practices and issue rules that would protect vulnerable people in Minnesota and across the country from being ripped off by settlement buyers.
You can read a copy of Sen. Smith’s letter here.