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Category: Pension Factoring

Minnesota Attorney General – Like CFPB – Sues Pension Advance Company

Minnesota Attorney General – Like CFPB – Sues Pension Advance Company

The Minnesota Attorney General has followed the lead of the Consumer Financial Protection Bureau and filed suit against a pension advance company, alleging that the company violated state lending laws, took unfair advantage in other ways, when it had veterans and senior citizens sign their pension rights to the company in exchange for immediate, but highly-discounted, cash payments. The Minnesota AG has sued Future Income Payments, LLC, which is the same company that is being sued by the CFPB over alleged…

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Court Rules Against Pension Factoring Company That Challenged Consumer Financial Protection Bureau’s Authority, Investigation

Court Rules Against Pension Factoring Company That Challenged Consumer Financial Protection Bureau’s Authority, Investigation

A federal court has upheld the constitutionality of the Consumer Financial Protection Board’s structure, and further found that the CFPB’s investigation into a pension factoring company’s business practices was neither overboard nor outside the CFPB’s jurisdiction. In Consumer Fin. Prot. Bureau v. Future Income Payments, LLC, Case No. SACV 17-00303-JLS ((SSx), 2017 U.S. Dist. LEXIS 80074 (C.D. Cal. May 17, 2017), Judge Josephine L. Staton of the federal district court for the Central District of California granted the CFPB’s petition…

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Factoring Company’s Identity Revealed: Future Income Payments Is the ‘John Doe’ Company Fighting the Consumer Financial Protection Board

Factoring Company’s Identity Revealed: Future Income Payments Is the ‘John Doe’ Company Fighting the Consumer Financial Protection Board

A company that has been fighting the Consumer Financial Protection Bureau’s jurisdiction and authority to issue a civil investigative demand – and did so under the name “John Doe Company” because it said its business would be harmed if its identity were known – has now been revealed. The company is Future Income Payments, LLC. And the CFPB issued its civil investigative demand to look into whether the company violated any federal law in connection with transactions involving pensions, annuities,…

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Federal Appeals Court’s Dissenting Judge Says CFPB Is Unconstitutional, Would Have Ruled For Secondary Market Company

Federal Appeals Court’s Dissenting Judge Says CFPB Is Unconstitutional, Would Have Ruled For Secondary Market Company

As described here, in a 2-1 opinion, the U.S. Court of Appeals for the District of Columbia denied a motion for an injunction, pending appeal, against the Consumer Financial Protection Bureau (CFPB) by a secondary insurance market company, and rejected that company’s argument that the CFPB’s structure violates the U.S. Constitution. The unidentified company had filed a lawsuit (John Doe Company v. Consumer Financial Protection Bureau, et al., Civil Docket No. 1:17-cv-00049-RC, U.S. Dist. Ct., District of Columbia) against the Consumer…

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D.C. Circuit Court of Appeals Rejects Secondary Market Company’s Constitutional Challenge to Consumer Financial Protection Bureau

D.C. Circuit Court of Appeals Rejects Secondary Market Company’s Constitutional Challenge to Consumer Financial Protection Bureau

A federal appellate court has rejected a secondary market company’s constitutional challenge to the federal  Consumer Financial Protection Bureau’s authority to investigate the company. The opinion of the U.S. Court of Appeals for the District of Columbia in Doe Co. v. Cordray, No. 17-5206 (D.C. Cir. Mar. 3, 2017) – decided with two judges in the majority, and one dissenting – is one of the latest developments in multiple fronts alleging that the actions or authority of the Consumer Financial…

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Columnist Offers Words of Caution about ‘Pension Advance Schemes’

Columnist Offers Words of Caution about ‘Pension Advance Schemes’

Bangor Daily News blogger and senior citizen advice columnist Dave Riley recently wrote about pension factoring, and his well-done blog post offers a good re-cap of some developments, as well as some words of caution. Wrote Riley: CONSUMER WATCHDOGS generally urge that people steer clear of these loans.  ‘Just don’t do it,’ one said bluntly.  But if you have a real emergency need for cash, see a legitimate financial counselor for advice before you commit. He also suggests that, if…

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Report: Pension Factoring Again Under Scrutiny Following Legal, Legislative Developments

Report: Pension Factoring Again Under Scrutiny Following Legal, Legislative Developments

Companies that are in the business of engaging in pension factoring, or pension advance, transactions are again coming under official scrutiny following developments in courtrooms and legislative forums, according to a recent news report. “Some retirees are making a terrible mistake with their pensions,” reported The Washington Post this week in a story that described the experiences of individuals entitled to receive military and government pensions who sold the rights to receive the future payments in what some say are legally-questionable types…

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Beware of Pension Advance Pitfalls, Warn Officials

Beware of Pension Advance Pitfalls, Warn Officials

According to the Consumer Financial Protection Bureau and various media reports, consumers should be wary of pension advances (also called pension loans and pension advance funding).  Some of the questions that officials suggest asking, before entering into such transactions, include the following: What are the costs? Does the consumer have to buy life insurance? Can the consumer cancel the transaction? Have complaints been made about the company offering the transaction? Is the company seeking to control the consumer’s benefits? Some of…

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Article: Be Aware of Legal Issues, Other Pitfalls When Looking At Pension Factoring

Article: Be Aware of Legal Issues, Other Pitfalls When Looking At Pension Factoring

A New York Times article on pension factoring from a few weeks ago advised about “Reading the Fine Print on Pension Advance Agreements.” The article describes legislation and other legal restrictions concerning pension factoring, but also that there appears to be gray areas that can result in potential pitfalls for consumers. “Agencies like the Consumer Financial Protection Bureau, Federal Trade Commission and Government Accountability Office have issued warnings about the services,” wrote the article’s author, John F. Wasik.  He also…

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Federal Legislation Would Address Pension Factoring

Federal Legislation Would Address Pension Factoring

One federal bill would revise the rules for structured settlement factoring transactions – as described here. Another, also recently introduced, would address consumer protection concerns about pension factoring. For more about the pension factoring bill, see the congress.gov page here.