ED Magedson – Founder
Imperial Structured Settlements701 PARK OF COMMERCE BLVD SUITE 30 Boca Raton, Florida United States of America
Formerly Called Washington Square, Imperial Admits Charging Customers 18 - 20% Interest Rates Per Year September 29, 2010 (Boynton Beach, FL) -
In a recent government filing, Imperial Funding admitted that interest rates charged to its customers average 17% per year, well above the industry averages. These rates put Imperial Funding formerly marketed as "Washington Square Structured Settlements" charging at the high end of the structured settlement factoring industry. Imperial's August 12, 2010 filing was made with the federal government.
Upon questioning, Deborah Benaim, a twenty year industry veteran and current Senior Vice President for Imperial, asserted that Imperial's interest rates are even higher than reported, "averaging 18 - 20% per year". This places Imperial among the most costly of factoring companies in the industry, offering its customers the least value. Industry speculation is that the new Consumer Financial Protection Bureau will have a dramatic, adverse impact on this industry.
According to a knowledgeable industry participant, these high discount rates cannot continue. As both sellers and courts become more aware of the financial abuse at the hands of certain factoring companies, they will either go out of business or will be forced to drastically reduce their rates. "Smart customers shop rates. Many judges question customers to ensure that they are getting a fair deal by requiring evidence of competitive shopping," commented Stewart Feldman, an attorney long active in the industry throughout the U.S. Feldman cited RSL Funding and Henderson Receivables as offering among the best rates in the industry, with Peachtree and Imperial offering among the least value. "It's not a surprise that the Imperial staff came from Peachtree. They know how to hammer customers," commented Feldman.
When questioned in a pending legal proceeding as to how Imperial can offer such little value to its customers, Imperial's Senior Vice President, Benaim, explained that Imperial spends upwards of $5,000,000.00 in marketing costs a year, including almost $4,000,000.00 on television advertising. According to an industry source, it is well known that customers that respond to television ads tend not to competitively shop, resulting in these customers receiving among the lowest prices paid. According to Benaim and the government filing, each customer, on average, bears $14,000.00 in marketing costs. One industry analyst figures that a customer not bearing this cost would receive on the average a full one-third more money up-front.
Imperial's conduct has not gone unnoticed. In a recent court decision, the New York Supreme Court wrote that Imperial's interest rates were "neither fair nor reasonable taking into account the actual amount [the customer] would be receiving. [The customer] would be receiving less than 1/3rd of the discounted present value . . . after legal fees and administrative fees".
Things may be changing. In recent years, RSL Funding and Henderson Receivables have offered customers a better alternative. RSL informs customers that are the victim of particularly egregious charges from Imperial that there is an alternative and makes competitive bids for the purchase of their future payments. "We've offered customers as much of $50,000.00 more than competitors for the same future payments," commented James Kelly, an RSL Funding's Senior Account Executive. RSL's Senior Account Executive, Derek Kopacz expressed, "When my customer received our offer of $35,000.00 more than Peachtree for the same future payments, he was ecstatic. When he received our check a few weeks later, I became his best friend. He couldn't believe how badly he was being taken advantage of by Peachtree Settlement Funding." Typically, RSL acquires payments free of fees and costs imposed on customers.
Attorneys for Peachtree and Imperial were asked for comments and corrections but offered no reply.
For further information, contact the Structured Settlement Institute (SSI), a not-for-profit organization established to educate sellers of structured settlements regarding fair and equitable practices among providers of structured settlement transfers.
For Further Information: Clete Thompson Structured Settlement Institute Boynton Beach, FL (561) 880-0333
This report was posted on Ripoff Report on 09/28/2010 09:24 AM and is a permanent record located here: http://www.ripoffreport.com/r/Imperial-Structured-Settlements/Boca-Raton-Florida-33487/Imperial-Structured-Settlements-IMPERIAL-FUNDINGS-HIGH-INTEREST-RATES-CRITICIZED-BY-COUR-645235. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.
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