An Austin judge on Wednesday approved the release of nearly $20 million back to defrauded investors who sunk money into National Life Settlements LLC.
About 320 investors will share $19.8 million, or about 69 percent of the amount they invested in the Houston company, which is accused of selling promissory notes that were purportedly backed by life insurance policies, according to the Texas Securities Commission.
Houston attorney Janet Mortenson, the court-appointed receiver in control of NLS, said checks to investors will be mailed Dec. 17.
A life settlement is the sale of an insurance policy to a third-party in exchange for a one-time cash payment. The purchaser then continues to pay the premiums and becomes the beneficiary of the policy.
Many of the investors were teachers and state of Texas retirees who turned over retirement funds to the company.
An investigation led by the State Securities Board and the Texas Attorney General’s office unveiled that National Life Settlements sold about $30 million in unregistered investments, mostly through insurance agents. The company, which also had offices in Austin and South Texas, marketed their investments as safe products that promised a steady return of 10 percent a year, according to court documents.
Howard Judah Jr., the chief executive officer and chairman of the board of NLS, is a three-time convicted felon whose most recent conviction was in U.S. District Court in New York in 1998 for conspiracy to commit wire fraud, according to the commission. Another principal of NLS, Gregory Jablonski of Castle Rock, Colo., also sold unregistered securities to unsuspecting retirees.
Thursday, December 17, 2009
A.I.G. Said to Plan Hong Kong Listing for Asian Life Insurance Unit
SHANGHAI — American International Group, the troubled insurance giant, has decided to submit plans later this month to raise billions of dollars next year by listing its Asian life insurance unit on the Hong Kong stock exchange, people briefed on the plans said Thursday.
The planned listing of American International Assurance is expected to help A.I.G. repay some of the huge debts it owes the United States government, which took an 80 percent stake in the company following a series of massive bailouts this year.
Analysts say the Hong Kong listing could raise as much as $20 billion, which would make it one of the largest public stock offerings in history.
The decision to submit a plan this month for a public listing was first reported in the Financial Times on Thursday.
A.I.A., which has more than 20 million policy holders in dozens of countries throughout Asia, is considered one of the bright spots in A.I.G.’s troubled portfolio.
This week, A.I.G. agreed to give a stake in the Asian unit to the New York Federal Reserve in exchange for forgiving a $16 billion loan that was threatening to damage A.I.G.’s credit rating.
Earlier this year, A.I.G. tried to auction off its Asian assets, but later scrapped the idea in favor of a public stock offering.
Deutsche Bank and Morgan Stanley have been selected to prepare the public offering, according to people familiar with the deal.
The planned listing of American International Assurance is expected to help A.I.G. repay some of the huge debts it owes the United States government, which took an 80 percent stake in the company following a series of massive bailouts this year.
Analysts say the Hong Kong listing could raise as much as $20 billion, which would make it one of the largest public stock offerings in history.
The decision to submit a plan this month for a public listing was first reported in the Financial Times on Thursday.
A.I.A., which has more than 20 million policy holders in dozens of countries throughout Asia, is considered one of the bright spots in A.I.G.’s troubled portfolio.
This week, A.I.G. agreed to give a stake in the Asian unit to the New York Federal Reserve in exchange for forgiving a $16 billion loan that was threatening to damage A.I.G.’s credit rating.
Earlier this year, A.I.G. tried to auction off its Asian assets, but later scrapped the idea in favor of a public stock offering.
Deutsche Bank and Morgan Stanley have been selected to prepare the public offering, according to people familiar with the deal.
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