Licensees of Life Partners Holdings Inc. were sued for $91 million over their roles in an alleged fraud that earned them “exorbitant” commissions on the sale of life settlement investments while concealing when people were expected to die, Bloomberg News reported yesterday. The lawsuit filed on Wednesday in Fort Worth, Texas comes as part of the bankruptcy of Life Partners, an owner of $2.4 billion in life insurance policies. The company dealt in life settlements, or “death bonds” — buying life insurance policies from ill or elderly people in need of fast cash and reselling them to retail investors promised high returns when the holder died, and the policy’s benefit was paid out. The suit was brought by a trustee overseeing the wind-down. He seeks to recover $91 million in commissions for investors it says were harmed. The licensees, named in the suit, were employed by Life Partners, he said.
