I feel you would see a lot more settlements like this if the majority of the groups and funds that were accussed of this type of fraud weren’t out of business or bankrupt.
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A Pentecostal pastor who bought a portion of the life insurance policy of an AIDS patient and Life Partners Inc., the Waco-based company that brokered the deal 13 years ago, settled their breach of contract lawsuit Tuesday after a day and a half of trial.
Under the terms of the settlement ironed out during the noon hour, Life Partners agreed to pay $150,000 to Earl Parchia, of Orlando, Fla., and Parchia agreed to surrender his interest in the life insurance policy.
Scott Peden, president of Life Partners, and David Tekell, a Waco attorney who represents Parchia, both said that they were pleased with the manner in which the lawsuit was resolved.
In an agreement dated Dec. 4, 1996, Parchia contracted with Life Partners to buy 42.8 percent of a policy on the life of a 36-year-old man who had been diagnosed as HIV-positive and with “full-blown AIDS,” according to the lawsuit.
The policy had a death benefit of $534,000, and Parchia and other investors paid $465,102 for the policy, the suit says.
As part of the deal, Life Partners reportedly agreed that Parchia would not have to pay more than a “policy purchase deposit” of $199,099. However, within two years, Life Partners told Parchia that “an escrow account established at the time of the funding had been depleted” and that he would have to start paying about $5,680 a year to maintain the policy.
“In response to these demands, and being totally at the mercy of Life Partners Inc., Parchia relented and paid $5,679.76 annually each year since 1998,” according to the lawsuit.
The AIDS patient is still alive, Tekell said.
By Tommy Witherspoon Tribune-Herald
