A U.S. Securities and Exchange Commission task force has been talking to a number of people who are active in the life settlement industry.
“We are aware of 4 to 6 brokers who spoke to them, along with 4 to 6 providers,” says Doug Head, executive director of the Life Insurance Settlement Association, Orlando, Fla.
The SEC task force has also been talking to attorneys and other experts familiar with the secondary market, Head says.
Head himself spent 2 hours in a meeting at SEC headquarters last month. He says he talked to 14 of the staff members who are on the task force, which was appointed by SEC Chairman Mary Schapiro to look into life settlements.
“They were just trying to learn about the business,” Head says of the meeting, which he says he had initiated.
He says he knows a broker who sat with task force members for 3 hours, explaining the paperwork and processes used in life settlements.
“I appreciate [that] they are trying to understand what our industry does,” he says.
“People are educating themselves” about settlements, “and the more education, the more people are going to benefit from this option,” he says.
Peter Mazonas, chief executive officer of Life Settlement Financial L.L.C., San Rafael, Calif., says he met with the SEC task force Nov. 2. Mazonas says he spoke in support of using accounting standards to assure consistent valuation of securitized pools of life settlements.
An SEC spokesman declined to comment on the task force’s study of the industry or to suggest when its work might be completed.
In a speech in Washington Oct. 22, Schapiro said she appointed the task force to help the SEC “understand the range of issues presented by the life settlements market.”
The SEC is also working with other government agencies to figure out whether there is sufficient regulation of the settlement market, she said in the speech.