Actively Soliciting Repeat Deals
What does it mean to “actively solicit repeat deals?”
It takes a great deal of time and effort to put together a structured settlement or annuity. Factoring a deal doesn’t have to be the entire settlement or annuity, it can be a portion. When it is a portion, it’s understandable that a factoring company will desire repeat transactions with a client that they had previously done business with. A follow-up sale is always acceptable, if not encouraged, for most industries. In the structured settlement industry, however, the purpose of the settlement to begin with is to assist a victim in a time of hardship. Factoring a deal is also for that purpose. Even sending a query for an additional deal is for the same purpose – but to do so constantly, that becomes the questionable activity.
Suppose a query, or simple sales follow-up, with an annuitant is done a month after completing a transaction. If the purpose of the call is to make sure the annuitant is satisfied and perhaps even an attempt to solicit future business as a result of that satisfaction, then this is within the realm of good ethics. In the event, however, that such queries are constant, and are beyond simply checking on the annuitant’s satisfaction but are simply calls actively soliciting more deals, this is problematic.
To factor a transaction in the first place, one has to pass a ‘best interest’ test since so much time and effort was spent in getting a structured settlement together as a result of hardship. When the money is being repeatedly factored, or there are attempts made by companies to convince annuitants to repeatedly factor after a successful deal, it’s no longer a matter of the best interest of an annuitant, who is not seeking solicitation; it’s instead transitioned into what’s best for the company’s bottom line and ultimately qualifies as nothing more than an aggressive sales tactic. Please refer to the aggressive sales tactics page under the issues tab for more information.
Another aspect of this ethical issue derives from some companies being “too” competitive in an original deal by quoting the numbers in such a way as to take a loss on the first deal; this is for the purpose of creating a working relationship with the annuitant for the purpose of soliciting more business in the future at far less competitive rates. The end result is that the original deal, albeit operating on a loss, is the door for a “long con” in which the company makes up the original loss with repeat transactions. Since the company took a loss to begin with to form the relationship, the motivation for engaging in repeat solicitations becomes far more prominent and therefore the pressure to make up the loss and gain a profit increases a great deal.
What can be done about it?
Ultimately this is a matter of company or salesman policy. Ideally, companies will back off of annuitants with the understanding that they’re more than simply customers, they’re victims. These are customers with special conditions and accommodations that must be met; one cannot, in good conscience, solicit even more business out of victims without considering that it’s entirely possible that it will result in further victimization. Such victimization is an ethical quagmire.
In the event that the repeat solicitation is against the will of the annuitant and is being conducted by phone, it is highly likely that the company in question is in violation of the Telephone Consumer Protection Act and is subject to a fine of $500 - $1,500 per phone call after a clear request or demand for a cessation of contact. For more information on this topic please refer to StopCashCalls.com, another website that’s a part of this Ethics Initiative.
Direct mailings should be disposed of immediately if you, as an annuitant, do not desire contact. Contacting the company directly with a clear request or demand for a complete cessation of contact, including the specific modes of contact being used, should also be made. In the event that this does not end contact, it is tantamount to harassment and the company can be reported to appropriate legal authorities. You can use the contact tab on this site to inform us in the event a company refuses to comply with your request or demand for such a cessation of contact.
In the event that you are being contacted in a manner you deem inappropriate, such as in person at your place of residence or place of work, or if contact is being made by social media, and you have explicitly requested or demanded a cessation of contact, please consult an attorney. In the event that you feel threatened by this contact, consultation of your local law enforcement may also be wise.