IMPORTANT NOTICE - 08/12/2008

On July 30, 2008, the Court entered an Order setting the Receiver's Motion to Sell All Insurance Policies for an evidentiary hearing on September 23-24, 2008, at 9:00 a.m. in Courtroom 1566 before U.S. Magistrate Judge Ramirez. The Receiver anticipates that the Court will oversee the second round of auction bidding for those policies at that time and approve the final sale.

Interested parties may view a copy of the Receiver's Motion to Sell All Insurance Policies, a list of those policies (Exhibit 1), and and the proposed Purchase and Sale Agreement (Exhibit 2). Through this motion, the Receiver asks the Court (1) to set a hearing date to oversee the second round of bidding by auction and (2) to approve the final sale price at the conclusion of that auction.

Over the last several weeks, numerous Taiwanese investors have sent e-mails to the Receiver and Examiner inquiring about the procedures for this sale. In an effort to respond to those questions, the Receiver has prepared a page answering the Frequently Asked Questions about those procedures.

On August 6, 2008, the Receiver also sent a letter to all known investors explaining the procedures for this sale.

UPDATE - 8/04/2008

The receiver has filed a Fourth Motion to Allow "A" claims. See Claims Information below:

UPDATE - 7/09/2008

The Receiver has recently issued responses to frequently asked questions about the proposed sale of the portfolio. Click here to review.

UPDATE - 7/03/2008

After taking into consideration the many comments of investors and discussing the matter with the SEC and the Examiner, the Receiver has decided to move forward with the proposed sale. This sale cannot be conducted, however, without the approval of the Court. The Receiver has accordingly filed a Motion seeking approval [click here for a copy]. In the Motion, the Receiver presents his reasons for moving forward.

If you do not want the Receiver to move forward with this sale, please contact the Examiner to advise him of your objection. You are also entitled to file an objection with the Court. Conversely, if you favor a sale, please advise the Examiner.

UPDATE - 6/27/2008

In light of the fact that we are receiving the same questions from many investors, we are in the process of posting these questions and our responses on the website. As such, we will not repetitively respond to each inquirer.

Update on Sale of Policies

As you may know from the pleadings posted on this site, the Receiver received Court permission to establish a secure website for access to key portfolio documents for interested buyers. Buyers were to submit sealed bids to the Receiver on or before April 30, 2008. The Receiver asked for bids on various groupings of the policies and on the portfolio as a whole.

The plan of the Receiver was to get bids and if a high enough bid was offered, to submit that to the Court for approval. If submitted, all other interested bidders will be invited to the Court house for an auction to occur in the Court house with the expectation that those who did not have the highest bid would over-bid the offer.

The bids have come in and the highest bid was $27,100,000. Although this amount is very disappointing, the Receiver and Examiner have met and given substantial consideration to this bid by virtue of the auction, the likelihood of the bid increasing, the continuing high cost of the premiums for these policies (about a million dollars a month) and alternatives to selling the portfolio.

The alternative that has seriously been considered is whether there are some policies that can be abandoned to save costs, some sold and some held with the hope of maturity. The Receiver would only consider abandoning a policy or policies in the event the premiums are high and the life expectance is long. For instance, one policy is a $2,500,000 policy and the premiums are about 880,000 a year. A plan to abandon some, hold some and sell some has been analyzed and it was determined that it did not present a reasonable chance of a greater return than a sale of the portfolio now.

The Receiver has also been informed by at least two parties that they intend to come to the auction and over bid the high bid.

Accordingly, the Receiver is in the process of signing a contract with the high bidder and preparing the necessary motion papers for the Court to obtain approval to sell the portfolio to the highest bidder at the auction.

Claims Information

  1. FIRST MOTION TO ALLOW "A" CLAIMS (05/01/08) – On May 1, 2008, the Receiver filed a motion to seek court approval of 206 of the investor claims submitted to the Receiver. Click here to see a copy of Receiver’s First Motion to Allow "A" Claims. Click here to see a copy of the court's Order Approving Receiver’s First Motion to Allow "A" Claims entered 6/03/08
  2. SECOND MOTION TO ALLOW "A" CLAIMS (06/04/08) – On June 4, 2008, the Receiver filed a motion to seek court approval of 216 of the investor claims submitted to the Receiver. Click here to see a copy of Receiver’s Second Motion to Allow "A" Claims. Click here to see a copy of the courts Order Approving Receiver's Second Motion to Allow "A" Claims entered 06/09/08.
  3. THIRD MOTION TO ALLOW "A" CLAIMS (07/01/08) – On July 1, 2008, the Receiver filed a motion to seek court approval of 226 of the investor claims submitted to the Receiver. Click here to see a copy of Receiver’s Third Motion to Allow "A" Claims. Click here to see a copy of the courts Order Approving Receiver's Third Motion to Allow "A" Claims entered 07/03/08.
  4. FOURTH MOTION TO ALLOW "A" CLAIMS (08/04/08) – On August 4, 2008, the Receiver filed a motion to seek court approval of 450 of the investor claims submitted to the Receiver. Click here to see a copy of Receiver’s Fourth Motion to Allow "A" Claims.

There are several things you should know.
First, THESE MOTIONS DO NOT ADDRESS ALL OF THE CLAIMS. Of the thousands and thousands we have received, these are the claims that have been reviewed as of May 1, 2008, and on which the Receiver and the claimant agree. These are being submitted to the court for approval. Once they are approved, the claimant will receive notice from the Receiver that the claim has been approved by the court.

Second, if your claim number and name are not on the lists attached to these motions, that just means that at this time your claim has not been reviewed or there is some issue that the Receiver needs to address with you. IT DOES NOT MEAN THAT YOUR CLAIM HAS BEEN REJECTED. The Receiver will contact you; you do not need to contact the Receiver or the Examiner.

Third, payment of claims will not begin until all claims have been resolved. It is impossible for the Receiver to know how much to pay each claimant until all of the claims have been approved by the Court.

This is a significant step towards completing the claims process. Each month, the Receiver will file a similar motion with the additional claims that he seeks to have approved.

THE RECEIVER HAS FILED AN UNOPPOSED MOTION TO SOLICIT BIDS FOR PURCHASE OF POLICIES AND APPROVE BID PROCEDURES. THE COURT HAS GRANTED THE MOTION. A COPY OF THE MOTION IN ENGLISH IS ATTACHED AT THIS LINK. A COPY OF THE COURT'S ORDER IN ENGLISH IS ATTACHED AT THIS LINK. THE MOTION AND ORDER IN ITS ENTIRETY WILL BE TRANSLATED AND POSTED ON THE CHINESE WEBSITE AS SOON AS POSSIBLE.

If you have an interest in purchasing the portfolio or any one of the individual policy groups that are offered, please follow the instructions at this link. 

UPDATES

QUESTIONS FROM INVESTORS

The Examiner frequently gets questions from investors regarding various issues and on going operations of the Receivership. The questions, as stated, along with the Examiner's answers are accessible by this link and will be updated by adding the new questions and answers as a newly numbered addition at the end of the existing list.

Lawsuit by the SEC:

On November 26, 2006, the Securities and Exchange Commission filed a law suit against ABC Viaticals, Inc, C. Keith Lamonda and Jesse W. LaMonda, Jr. as Defendants. Generally, the complaint also asked for the seizure of property and records owned by LaMonda Management Family Limited Partnership, Structured Life Settlements, Inc., Blue Water Trust and Destiny Trust. A copy of the Complaint can be accessed by this link. The SEC's reasons for filing the suit are explained in the Complaint.

The Court also entered an Agreed Preliminary Injunction, Order Freezing Assets, Order Requiring an Accounting and Order Requiring Preservation of Documents. The text of this order can be accessed by this link. This order, directed to the Defendants and all those in concert with them, requires that no assets be spent or transferred, that the Defendants provide an accounting of the assets of ABC Viatical, Inc. and the related entities. It also orders all records preserved.

Appointment of a Receiver:

The Complaint was filed in the United States District Court for the Northern District of Texas and the Judge in the assigned court entered an immediate order appointing a Receiver over all of the defendant entities named in the case. Michael J. Quilling, Esq. was appointed as the Receiver. He has extensive experience as both a recevier for various companies and as a receiver of viatial based companies. The Receiver has very broad powers, including the authority to seize all of the property of the entity defendants and to take the necessary action to preserve and protect the assets of the entity defendants for the benefit of the investors. A copy of the Order Appointing Receiver can be accessed by this link. The order was an "agreed order" meaning that the defendants agreed to the court entering the order against them.

Appointment of an Examiner:

On November 29, 2006, the Receiver filed a motion requesting the appointment of an Examiner. On November 30, 2006, the Court entered an order appointing Steven A. Harr, Esq. as Examiner in this matter. A copy of the Motion can be accessed by this link. A copy of the Order Appointing Examiner can be accessed by this link. The Examiner has been appointed by the court to keep investors informed of the key events in the proceeding, to field investors emails and calls, to gather information and input from investors from time to time on key issues before the Recevier and the Court and to monitor and advise the Receiver on his actions with the best interests of the investors in mind. The Examiner can be accessed by email to ABCexaminer@munsch.com. If you do not have access to email, you can leave a voice mail at (214) 740-5112.

Anticipated Events over the Course of the Receivership:

At this point, the specifics of what will happen in the Receivership are not completely clear. However, there are some common events that can be explained and are fully anticipated to occur.

Marshalling of Assets: The Receiver is charged with gathering and preserving the assets of the Defendants. Of course this includes the insurance policies held in trust. There may well be other assets including real estate, personal property and claims against third parties for the return of money to the receiver. The assets will be gathered and to the extent it is wise to do so, liquidated to create cash that can be returned to the investors. No decision has been made on whether the insurance policies will be liquidated or held to maturity.

Determination of Claims: The Receiver is also charged with determining who has invested money with the Defendants, gathering proof of those investments and determining, though a court approved process, the method for fixing the amount of those claims. Investors will get specific information on this process. Investors do not need to do anything at this time.

Return of Investments: At some point in the future, the Recevier will apply to the court to take the money he has gathered from the assets and pay it to those who have an approved claim. This usually occurs near the end of the Receivership. There is no way at this time to project when that will occur or the amount of money that each investor will be paid.

PLEASE RETURN TO THIS WEBSITE REGULARLY.
IT WILL BE UPDATED AS NEW INFORMATION IS AVAILABLE.

YOU CAN CONTACT THE EXAMINER BY WRITING AN EMAIL TO
ABCexaminer@munsch.com OR BY CALLING (214) 740-5112.