This is an update of the once popular but now basically extinct “Wet Paper Life Settlements”. This is where a policy is issued and sold almost instantly for small percentage of the face value (2% - 6%). We highly advise not to get involved in such life settlement transactions.
Article Below:
AXA Equitable Life Insurance Co. filed suit earlier this month in federal court in Florida alleging that several brokers, insureds and their trustees obtained $73 million in fraudulent, stranger-originated life insurance (STOLI) policies.
The suit was filed June 6 in U.S. District Court for the Southern District of Florida. Defendants named include Infinity Financial Group of Boynton Beach, Fla., and Steven Brasner, principal of the group; the Kevin Bechtel Broker General Agency; the Gary Richardson Broker General Agency; and trustees and insureds.
The defendants, who have 20 days to respond from receipt of the complaint, have not yet filed a response. No one from the broker general agencies returned calls from The Life Settlements Wire.
Tim Bodner, president of Infinity Financial Group, said Brasner was terminated from the company in May 2006, and that Infinity sued Brasner when he used the company’s name and logo for his own business. Bodner said the case has since been settled.
The lawsuit seeks declaratory relief and rescission of five life insurance policies it says were “procured by improper and fraudulent means and procured for improper and undisclosed purposes.”
AXA says the policies were issued between July 2006 and February 2007 for $73 million. One of the policies – for $5 million – has since lapsed, the suit says.
The New York insurance company says that almost immediately after the policies were issued, the ownership and beneficiary designations were changed and the policies were put into trusts.
AXA is seeking to retain the premiums to offset damages the company expects to incur. It also is asking for return of more than $2.8 million it paid in commissions.
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