How to Spot Structured Settlement Scams?

In the age of Bernie Madoff, consumers and advisors are rightfully wary of scams, especially in alternative investment classes.  Even in highly regulated securities trading – Bernie Madoff’s business- consumers are not immune to bad actors.

But in all honesty, it would be very difficult to successfully fabricate a structured settlement transfer.  You would need a  combination of spectacularly unsophisticated buyers, and colluding outside counsel, and a complicit carrier.  In short, it ain’t gonna happen… There are just too many parties involved and outside legal reviews, confirmations, and court documents necessary to do it right.

Think of it like a house, or a car.  Sure, you could respond to the classified ad from the guy looking to sell, but you’d be an idiot to hand over money without getting a title or a deed.  In this same manner, a seller couldn’t fabricate the existence of a settlement and then try and sell it. The insurance carriers have their own legal counsel and there are a court process and confirmations by the carrier that all verify what the seller has and what is available for transfer.

structured settlement scams

Structured Settlement Transfer Risk

But just like any investment, there are some degrees of risk in a structured settlement transfer.  Overall, all these types of risks are bundled up and labeled as transfer risk.

The purpose of the DCF business structure is to insulate the end investor from transfer risk. DCF Exchange is the first buyer of the deal, and as such is a professional intermediary well versed in the marketplace. We don’t even make closing books available to advisors or close any sales to end customers until after the deal has passed all legal review and is complete.

As a capitalized intermediary, DCF Exchange is the counter-party dealing with the originator.  We engage the legal counsel and rely on their experience and our own systems and procedures to ensure each transaction is thoroughly vetted and approved.  Transfer risk is much more applicable when investors try and buy directly from factoring companies without having sufficient industry knowledge or legal representation to know what they are doing.

Keep in mind that no investment is without some degree of risk- even Treasuries, traditional annuities, and CD’s have some degrees of risk that needs to be acknowledged. Even still, these are all typically lumped into the ‘safe’ and even ‘secure’ bucket. DCF Income Payments, also known as secondary market annuities, are in the same category as the underlying payment contracts are secured, fixed, and period certain from top carriers.

The very slight degree of added ‘transfer risk’ is mitigated and managed through our court-ordered, legally reviewed and heavily scrutinized transfer process.

What our customers say about DCF Exchange

“Fast, easy process for sale of SMA’s”

Fast, easy process for sale of SMA’s. ACH and wire of money, and the GoldStar relationship make this a very easy process. The DocuSign system used makes it easy to work with clients since there is no in person meeting required. Although we do like to meet in person with clients… will use DCF Exchange for all SMA sales!!!!! A ++++++++

“I have worked with Nathaniel at DCF for…”

I have worked with Nathaniel at DCF for years. Everything is always professional and seamless. A pleasure to work with.

“This is the second transaction I did…”

This is the second transaction I did with Nathaniel Pulsifer at DCF and both went very smoothly. Clients are very happy. I try to incorporate these types of secondary annuities when appropriate. I would highly recommend Nathaniel Pulsifer and DCF to anyone who wants to incorporate these in a clients financial plan.

“These guys are the absolute best”

These guys are the absolute best! I’ve been working with Nathaniel and Ross for many years now, and there’s nobody better in the business. Their knowledge of the industry is unsurpassed, and most importantly they are HONEST and TRUSTWORTHY. I look forward to working with DCF Exchange for many years to come.

“I had an amazing experience with DCF

I had an amazing experience with DCF! Nathaniel and his team are extremely dialed into these specialty products and I definitely would work with him again! Thanks!

“Extremely knowledgable and ethical”

Extremely knowledgeable and ethical. A pleasure to do business with.

“How fast was that”

How fast was that? VERY!
I was most pleasantly surprised how quick and efficient my payment was processed. Very safe, efficient and accurate.

“Thank you for putting your platform…”

Thank you for putting your platform together. Very nice work, easy for everyone to complete transactions. Almost as easy as writing annuities was 20 years ago –you probably weren’t around when the entire annuity application was 1 sheet of paper, front and back. You could send in that one piece of paper with a check and the deal was done!

“DCF performed far above and beyond my……”

DCF performed far above and beyond my expectations from beginning through the end closing process and beyond. When there seemed to be an issue with the trustee, DCF stepped in and cleared up all misunderstandings and insured everything was correct. I should note that the misunderstandings were really on my part and, once I was finally clear, I now fully understand and agree. Thank you DCF.