Financing Companies, Lawyer Accused of Preying on Disabled SSA Beneficiaries

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A proposed class action has been filed against attorney Stephen E. Heretick and the following corporations the complaint says he represented in a series of allegedly fraudulent transactions: 321 Henderson Receivables LLC, J.G. Wentworth Originations LLC, Seneca One Finance, Inc., and Structured Settlement Investments, LP.

According to the lawsuit, the plaintiff is a beneficiary of a structured settlement annuity (SSA) awarded to him after he became permanently disabled in a work accident. From the annuity, the plaintiff will reportedly be paid lump sums every five years until 2034 in addition to monthly payments for the rest of his life, the lawsuit says, unless he transfers his right to the payments to another person or entity through court approval.

The complaint alleges that the defendants have engaged in a “predatory” scheme by which they convince SSA beneficiaries such as the plaintiff to sell their payment streams and forfeit large sums of money to the defendant companies.

“The potential profit from such purchases are extraordinary,” the complaint reads, “because the beneficiaries of SSAs are very often unable to make well-informed judgments about the true value of the income streams to which they are entitled.”

The lawsuit alleges that the defendants target beneficiaries and, through aggressive marketing, win their trust by promising them “financial benefits greater than those they received from their SSAs.” Then, the complaint continues, the companies allegedly lure their “victims” to the County Circuit Court of Portsmouth, Virginia, coerce them into falsely stating they are residents of Virginia, and convince them to waive their right to “independent professional advice” before their petitions to sell their income streams are presented to the judge. The suit alleges that the defendants further advise the beneficiaries not to appear in court or retain legal representation. The corporate defendants are then represented in court by attorney defendant Stephen E. Heretick, the lawsuit claims, whose alleged role is to convince a judge to approve the heavily discounted sales, thereby robbing SSA beneficiaries of their funds.

The suit claims that absent the defendants’ allegedly illegal conduct, proposed class members never would have agreed to sell their payments based on the terms offered to them by the defendants and the transactions never would have been approved in any court that sufficiently reviewed the transactions or in which the beneficiaries were properly represented by legal counsel.