Editing Structured settlement (section)

===Sales of rights to structured settlement payments===
{{main|Structured settlement factoring transaction}}

A claimant who has agreed to a negotiated structured settlement elects to receive part of their settlement money at the time of settlement, and part of their settlement money in the future through a negotiated, customized schedule of periodic payments that are "fixed and determinable as to amount and time of payment."<ref name="irc130">{{cite web|title=26 U.S. Code § 130 - Certain personal injury liability assignments|url=https://www.law.cornell.edu/uscode/text/26/130|website=Legal Information Institute|publisher=Cornell Law School|accessdate=5 September 2017}}</ref> The life insurance companies who underwrite these periodic payment obligations and the associated qualified assignment companies, must comply with the Internal Revenue Code 130,<ref name="irc130"/> which, in part,  does not allow for acceleration or modification of payments. Options exist for structured settlement annuitants to sell or transfer the rights to future periodic payments to purchasers of structured settlement payment rights, mostly known as structured settlement factoring companies.  Some life insurers, such as Berkshire Hathaway Life Insurance Company of Nebraska, and former structured annuity issuers Allstate Life Insurance Company and Symetra,  offer to buy part or all of one's structured settlement payment rights in return for a lump sum cash provided such transaction complies with IRC §5891.<ref name="irc5891"/>

Although many beneficiaries of a structured settlement find that the settlement suits their needs, some may experience changed financial circumstances and find themselves unable to obtain funds through conventional financing or other sources. They may want to obtain funds from the structured settlement in order to pay down debt, help pay for a house, help pay for a child's college tuition, or for other significant financial needs. At the same time, companies that buy structured settlements have been known to take advantage of beneficiaries' circumstances in order to obtain the settlements for a relatively small price.<ref>{{cite news|title=Maryland attorney general urges structured settlement reforms|url=http://www.baltimoresun.com/news/maryland/politics/bal-maryland-attorney-general-urges-structured-settlement-reforms-20160225-story.html|accessdate=5 September 2017|agency=Associated Press|work=The Baltimore Sun|date=25 February 2016 |url-status=dead |archive-url=https://web.archive.org/web/20170905191251/http://www.baltimoresun.com/news/maryland/politics/bal-maryland-attorney-general-urges-structured-settlement-reforms-20160225-story.html |archive-date= 2017-09-05}}</ref>

The act of the sale and purchase of structured settlement payment rights is known as a structured settlement factoring transaction.<ref name="irc5891"/> For example, a structured settlement payment stream of 20 years could be transferred in exchange for one discounted payment now.

Any sale of structured settlement payment rights will require the approval of a judge to comply with the local state structured settlement protection act and IRC 5891. Enforcement of structured settlement Approval is not a given. In 2012, a Tennessee Chancery Court issued an order denying a payee's transfer of workers' compensation settlement payments under a structured settlement agreement.  Judge William E. Lantrip held that (i) workers' compensation payments are not within the definition of "structured settlement " under the Tennessee Structured Settlement Protection Act, Tenn. Code. Ann. §47-18-2601 <ref>{{cite web |title= Tennessee Court Denies Transfer of Workers' Compensation Payments  |url= http://www.natlawreview.com/article/tennessee-court-denies-transfer-workers-compensation-payments|publisher= Drinker Biddle & Reath LLP |work=The National Law Review|date=2012-07-05|accessdate=2012-07-12}}</ref>

Enforcement of the state system of structured settlement protection acts has come under heavy scrutiny after a highly publicized story of alleged abuse of a cluster of annuitants who received structured settlements as part of lead paint settlements in Baltimore City appeared in the Washington Post on August 25, 2015.<ref>{{cite news|last1=McCoy|first1=Terrence|title=How companies make millions off lead-poisoned, poor blacks|url=https://www.washingtonpost.com/local/social-issues/how-companies-make-millions-off-lead-poisoned-poor-blacks/2015/08/25/7460c1de-0d8c-11e5-9726-49d6fa26a8c6_story.html |url-access=subscription |accessdate=13 June 2017|agency=Washington Post|date=25 August 2015 |url-status=live |archive-url=https://web.archive.org/web/20170730095927/https://www.washingtonpost.com/web/20170730095927/https://www.washingtonpost.com/local/social-issues/how-companies-make-millions-off-lead-poisoned-poor-blacks/2015/08/25/7460c1de-0d8c-11e5-9726-49d6fa26a8c6_story.html?utm_term=.32bce72da544 |archive-date= 2017-07-30}}</ref> leading to rapidly passed reform of the Maryland Structured Settlement Protection Act<ref>{{cite web|title=Maryland Senate Bill 734|url=http://mgaleg.maryland.gov/2016RS/chapters_noln/Ch_722_sb0734T.pdf|website=General Assembly of Maryland|accessdate=13 June 2017}}</ref> and lawsuits brought against the Chevy Chase MD company that originated the deals and a number of its executives by the Maryland Attorney General,<ref>{{cite news|last1=Wells|first1=Carrie|title=Attorney General's office and attorneys spar over settlement for lead paint victims|url=http://www.baltimoresun.com/news/maryland/baltimore-city/bs-md-lead-paint-lawsuit-20170724-story.html|accessdate=5 September 2017|agency=The Baltimore Sun|date=24 July 2017}}</ref> The Consumer Financial Protection Bureau<ref>{{cite web|title=CFPB Sues Access Funding for Scamming Lead-Paint Poisoning Victims Out of Settlement Money|url=https://www.consumerfinance.gov/about-us/newsroom/cfpb-sues-access-funding-scamming-lead-paint-poisoning-victims-out-settlement-money/|website=CFPB|publisher=Consumer Financial Protection Bureau|accessdate=5 September 2017|date=21 November 2016}}</ref> and a plaintiff's class action.

On September 14, 2017 a class action lawsuit filed in the Eastern District of Pennsylvania,<ref>Larry G. Dockery, On behalf of himself and all others similarly situated, Plaintiffs v Stephen E. Heretick, 321 Henderson Receivables, LLC, JG Wentworth Receivables, LLC,  Seneca One Finance, Inc., Structured Settlement Investments, LP,  Structured Settlement Purchaser John Doe Inc. Purchaser Defendants 1-100 and John Doe Individual Defendants 1-100 and  New York Life Insurance Company, Metropolitan Life Insurance Company, Symetra et al*.  United States District Court Eastern District of Pennsylvania Case 2:2017:cv-04114-MMB</ref> alleging Portsmouth Virginia Circuit Court judges were complicit in an "Annuity Fraud Enterprise" scheme, in which a Virginia lawyer and 79th District delegate [[Steve Heretick]] was the central figure, representing JG Wentworth, Seneca One, 321 Henderson Receivables and other settlement purchasers, that allegedly violated the rights of thousands of structured settlement annuitants. Plaintiffs allege violations of RICO statutes against multiple defendants, violations of right to due process an seek a constructive trust against all defendants and all nominal defendants which include several life insurers who issue the annuities.