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Judge orders Life Partners to suspend viatical business. Clearinghouse, P.O. Box 6003, Rockville, MD 20849-6003. 800-458-5231 ext. 5714.

September 30, 1996
AIDS Policy Law. 1996 Mar 8;11(4):5. Unique Identifier : AIDSLINE

Life Partners, Inc., a viatical settlement company, has been enjoined from selling new life insurance policies until it complies with Federal securities laws. U.S. District Judge Royce C. Lamberth stated that Life Partners did not comply with court orders to restructure its operations in such a way that its viatical settlement contracts would not constitute securities. The Securities and Exchange Commission asked that Life Partners be held in contempt of court, as the company is not registered to trade securities. Life Partners asked people to assign their life insurance policy to the company and not to individual investors. When the person died, the benefits were paid to Life Partners and then to investors. As a result, investors had no contractual rights against the insurance companies that issued the policies. The judge ruled that Life Partners had made some changes and improvements and would therefore not hold the company in contempt of court.

*Acquired Immunodeficiency Syndrome Human Insurance, Life/*LEGISLATION & JURISPRUD Investments Texas NEWSLETTER ARTICLE