View Full Version : U.S. Soldies Death Benefit scandal

08-05-10, 09:56 AM
U.S. Soldier Death Benefit scandal

August 1, 2010 - 3:58 PM | by: Lauren Torlone (http://liveshots.blogs.foxnews.com/author/torlone/)
A new six month investigation conducted by Bloomberg Markets Magazine (http://www.bloomberg.com/markets-magazine/) is shedding light on the mishandling of death benefit funds belonging to families of fallen U.S. soldiers. The investigation, led by senior writer David Evans, discovered that insurance companies are profiting off the death benefits of American soldiers killed in combat.
Speaking Sunday to Fox News (http://www.foxnews.com/americasnewshq/), Evans explained the deceptive practices. Following a soldier’s death, family members were provided with policy documents from insurance giants including Prudential Financial that led them to believe death benefit funds were being held in a secure, FDIC protected account. But in reality, the funds were not FDIC protected and not being held in a bank.
To make matters worse, the investigation uncovered similar practices being carried out by MetLife for four million non-military federal employees, including government employees and workers at the FDIC.
The investigation, which is profiled in Sunday’s Washington Post Business (http://www.washingtonpost.com/wp-dyn/content/article/2010/07/31/AR2010073100035.html) section, uncovered that death benefit funds were being held in general accounts, making them subject to the claims of insurance company creditors. Evans said insurance companies have been "earning 4 to 5 percent interest in cases involving soldier death benefits and federal employees" while policy holders remain unaware "that the money is not in a bank."
Since publication of the Bloomberg report, Evans said there has been an "immediate response" on several fronts. Evans, who has personally received over one-thousand emails about the report, said the "Veterans Administration has announced an investigation" into the matter, as has New York State Attorney General Andrew Cuomo (http://www.ag.ny.gov/media_center/2010/july/july29a_10.html). A spokesman for Prudential Financial said the company is prepared to cooperate with Cuomo’s investigation.
Earlier this week, MetLife issued a statement (http://www.nasdaq.com/aspx/stock-market-news-story.aspx?storyid=201007291611dowjonesdjonline000 770&title=metlife-issues-statement-on-ny-ag-cuomos-subpoena-of-co) defending its policy, saying in part, "we strongly disagree with many misleading statements in recent media reports" and defended materials provided to policy holders, underscoring that policy holders have "full access to their funds and earn a guaranteed minimum interest rate that exceeds what they could earn" on most other existing accounts.
While the terms and conditions of accounts operated by Prudential Financial and MetLife are specified in materials provided to account holders, Evans said its done in such a way that they are "buried" and not understood by policy holders, something that has allowed insurance companies to continue carrying out these practices for two decades.
To read the Bloomberg Markets report in its entirety, visit http://www.bloomberg.com/news/2010-07-28/duping-the-families-of-fallen-soldiers.html (http://www.bloomberg.com/news/2010-07-28/duping-the-families-of-fallen-soldiers.html)

08-05-10, 10:59 AM
Insurance companies have three main interests. Their salaries, their golden parachutes, and their stock holders, in that order. the people who who pay for those things, are just the herd they milk. According to AOL, this morning, a whole bunch of them are are talking about giving away half of their fortunes to 'Charity'. I do not believe that story, but if it ever did happen, Man, what a tax deduction !! Again, the little guy gets screwed. :beer: S/F!!! Ken