Investigating Potential Claims – Life Settlements Absolute Return I LLC
The White Law Group is investigating potential claims involving broker-dealers who may have unsuitably recommended Life Settlements Absolute Return I LLC to investors.
On December 29, 2017, Life Settlement Absolute Return I LLC along with Senior LS Holdings, LLC filed petitions for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware.
According to the bankruptcy documents, the company was formed as a special purpose vehicle to invest in life insurance policies in the life settlement market. Life Settlement Absolute Return I reportedly has comprehensive agreements with third-parties for the provision of management, administrative and operational services. Senior LR operates as a holding company for the policies.
Additionally, the Debtors have reportedly been unable to pay their existing debt, primarily because many insureds have outlived their actuarial life expectancy, prolonging LSAR’s receipt of cash from the death benefits of the policies, according to the court documents. Thus, it became financially difficult for the company to continue servicing premium payments on the policies.
According to the Form D filing, Attilanus Fund I LP is the beneficial owner of the entity and is also listed first on the bankruptcy creditor list.
Risks of Regulation D Private Placement Investments
Life Settlements Absolute Return I LLC is a Regulation D Private Placement investment. It was filed in 2008 in Pittsburgh, PA. The total offering amount was $64,000,000.
Investments such as these are typically sold by brokerage firms in exchange for a large up front commissions. High fees can range from 7-10%, as well as additional “due diligence fees” that can range from 1-3%.
The problem with private placement investments such as Life Settlements Absolute Return I LLC is that they involve a high degree of risk. They are typically sold as unregistered securities which lack the same regulatory oversight as more traditional investment products like stocks or bonds. These investments may seem wise at first, until the dramatic drop in distributions.
Despite the risks of investing in private placements, brokerage firms continue to push this type of investment because of the high commissions associated with their sale and creation.
If a brokerage firm makes unsuitable investment recommendations or fails to adequately disclose the risks associated with an investment they may be liable for investment losses through FINRA arbitration.
The Financial Industry Regulatory Authority (FINRA ) operates the largest securities dispute resolution forum in the United States, and has extensive experience in providing a fair, efficient and effective venue to handle a securities-related dispute.
Are you concerned about your investment loss in Life Settlements Absolute Return I LLC? If so, the securities attorneys at The White Law Group may be able to help you. Please call 888-637-5510 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee.
For more information on The White Law Group and its representation of investors in FINRA arbitration claims, visit https://www.whitesecuritieslaw.com.