A federal judge in Fort Worth, Texas, has approved a reorganization plan for Waco-based Life Partners Holdings Inc., which filed for bankruptcy protection in 2015 amid allegations that the company and founder Brian Pardo defrauded investors and put more than $1.4 billion in premiums at risk, the Waco Tribune reported today. The action means Pardo has no further involvement in the entity he created in 1991 to broker sales of life insurance policies from terminally ill patients to investors from around the world. Life Partners Holdings became a frequent target of the Securities and Exchange Commission, which most recently alleged the company purposefully underestimated the life expectancy of clients selling policies, making them more desirable to investors. The commission imposed an almost $47 million judgment. That case prompted the company’s bankruptcy filing and the involvement of trustee H. Thomas Moran II. Bankruptcy Judge Russell F. Nelms confirmed the reorganization plan on Tuesday after Moran spent months identifying 22,000 investors; holding town hall-style informational meeting in several cities, including Waco; and holding five weeks of hearings before Judge Nelms in a Fort Worth courtroom. The ruling preserves a portfolio of life insurance policies with a face value of $2.4 billion and provides a more certain future for $1.4 billion in premiums. Read more.
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