Updates

Update - December 6, 2006

Anticipated Events Over the Next Month:

The Receiver has been very active since his appointment, meeting with the employees of ABC Viaticals, Inc., in constant communication with the attorneys for the Defendants, meeting with the former Trustee, filing numerous motions to get control of key aspects of the company and its assets  and beginning his review of the available records and information so as to understand the current needs and concerns of the company.  As many of you may know, the policies of ABC Viaticals were placed in separate trusts when purchased and the trustee of those trusts has now resigned effective on the date of the Receivership and Mr. Quilling is now in control of those trusts in his role as the Receiver.

The Receiver has successfully gained control of about 4.5 million in cash that are funds held by ABC Viaticals, Inc. At present, this money represents the only known cash on hand.

The Receiver is actively working to determine all aspects of the premium payments that are due from the trusts associated with ABC Viaticials, Inc. The records of the company are fairly good but inaccuracies have already been discovered and the Receiver is checking on every policy to be sure that the amounts due are correct and to confirm the timing of those payments.

The Receiver has filed a motion to expand the scope of the Receivership to include a number of trust entities used by ABC Viaticals, Inc. to conduct business. This will be done in order to make sure that the assets that are part of the company are included within the authority of the Receiver and the Court. A copy of this Motion can be accessed by this link.

It is currently the belief of the Receiver that there are not sufficient funds available to pay the premiums that will come due on the life insurance policies before they mature. A preliminary report done by an outside agency before the appointment of the receiver on a portion of the policies shows that the expected premiums due on just those policies over the remaining life expectancy of the viators is about 9 million dollars. Given that this report only addresses at most half of the policies, and there is only about 4.5 million in cash on hand with no other funds coming into the receivership except by maturities, serious questions are presented as to how to be sure that the policy premiums are paid and the assets preserved. To this end, the Receiver has filed a motion asking the court to pool all of the assets of the receivership into one large pool to be used for the benefit of all involved. This will necessarily include using any maturities to fund the continuing cost of the receivership instead of paying investors currently assigned fractionalized interests in the matured policy. A copy of this Motion can be accessed by this link. Without this money or money from some other source, the premiums may not be paid and policies may lapse. The Receiver is asking the Court to create a single pool of assets for ABC Viatical, Inc. from which the expenses of the Receivership are paid, principally the premiums necessary to preserve the policies and the expenses of the administration of the receivership. This Motion was also filed with the agreement of the Defendants. There are specific consequences to each investor if this Motion is granted and those consequences will be discussed at a later date.

The Recevier also anticipates filing a Motion for Premium Funding Agreement. This motion will ask for Court permission to get a 5 million dollar line of credit secured by the policies to be used as a last resort to pay premiums. The Receiver believes that it is wise to get court permission and to negotiate a possible line of credit to be used to pay the premiums on the policies.

This website will provide you with the outcome of these Motions to the Court and continuing updates on the events in this matter.