# Structured Settlement Companies Exploit Accident Victims With Minimal Legal Protection

John Oliver's recent segment on structured settlement buyers didn't go far enough in exposing the predatory nature of these "cash now" companies, according to consumer advocates. These firms target accident victims who receive court-ordered periodic payments, offering lump sums upfront in exchange for their future settlement money.

The mechanics are straightforward and devastating. An accident victim receives a structured settlement paying $50,000 annually for 20 years. A "cash now" company like JG Wentworth or Structured Settlement Funding offers $400,000 to buy out that entire stream today. The victim walks away with cash. The company profits by collecting the full $1 million payment from the original source while paying only $400,000.

Current regulations provide minimal protection. Federal law requires court approval for these transactions, but courts rarely deny them. State laws vary wildly, and enforcement remains weak. Victims often lack financial sophistication and face real pressures. Medical bills mount. Debt collectors call. The lump sum feels like salvation.

What makes these arrangements particularly troubling is the lack of transparency around discount rates. A company might claim the 50 percent haircut reflects time-value-of-money calculations, but victims receive no independent analysis. No requirement exists for companies to disclose their profit margins or to ensure customers understand the long-term cost of their decision.

The FTC has brought enforcement actions against some major players for deceptive marketing, but prosecution moves slowly. Meanwhile, aggressive advertising targets vulnerable people during their most desperate moments.

If you receive a structured settlement offer, get an independent financial advisor to calculate the true cost. Understand that you're giving away guaranteed future income. Explore borrowing against your settlement through other means first. Many structured settlement recipients later regret their decisions once they realize they've surrendered