Tallahassee – A final settlement has been approved that will provide some compensation to investors who were victimized by the former Future First Financial Group, Inc., of Ponte Vedra. Judge J. Michael Traynor, acting for the Seventh Circuit Court, in St. Johns County, approved a purchase and sale agreement that could allow the sale of the life insurance policy portfolio of the former viatical settlement provider.
The Florida Office of Insurance Regulation convinced the court to appoint a Conservator, on August 9, 2002, to prevent the assets of the company from being lost. Normally, troubled viatical settlement companies would have their policies held until all have matured and any agreements have been settled. Realizing that the assets were in jeopardy of being lost, had this process been followed, OIR attorneys convinced Judge Traynor to resort to the Conservatorship - a novel approach in the viatical arena.
"While the investors in Future First will not recover everything they put in, they will get something back," said Office of Insurance Regulation Director Kevin McCarty. "I give great credit to the investigators and attorneys who handled this case; they saw the potential total loss involved and managed to salvage something for the victims of Future First." Further action is anticipated to seize the assets of the former principals of Future First and may lead to additional recovery for the investors.
The former president of Future First Financial Group, Randy E. Stelk, was booked last May on charges of racketeering, securities fraud and grand theft. Also awaiting trial on similar charges are Francis X. Keaveny II, Alan H. Anderson and Charles R. Sussman. The four were principals in Future First Financial Group.
Their arrests were the result of investigations by various Florida agencies: the Office of Insurance Regulation, the Office of Financial Institutions and Securities Regulation, the Department of Financial Service's Division of Insurance Fraud and the Department of Law Enforcement. An estimated 5,000 investors had put more than $300 million into life insurance death benefits with the firm.
In a viatical settlement transaction, investors contract to purchase an interest, in whole or in part, of the future death benefits of life insurance policies. Upon the death of the insured, investors receive their share of the death benefit, which they hope exceeds their total investment. Future First offered and sold investments in viatical settlements.