Life Partners Holdings, Inc. investors have filed a class-action lawsuit against the Waco Texas based life settlement provider, alleging that its directors and officers violated securities laws.
The lawsuit comes a month after an announcement was made that the publicly traded company is the subject of an SEC investigation into the life expectancies the company uses to value the life insurance policies it sells to its customers.
Life Partners is accused of misleading its customers—investors in life insurance policy—about the life expectancies of insureds on the policies it sells, with insureds outliving the life settlement company’s life expectancy estimates 90% of the time.
For previous coverage of Life Partners Holdings and life settlements in general in Advisor’s Journal (subscription required), see Life Settlement Provider Accused of Falsifying Life Span Reports (CC 11-23), Life Settlements Funds Performance Fees under Scrutiny (CC 10-116) & Should the Basis of a Life Contract be Adjusted by Mortality Charges? Rev. Rul. 2009-13 Says Yes in Context of Life Settlements; Certain Amounts over Adjusted Basis Treated as Capital Gains (CC 09-19).