BERKELEY, Calif.--(BUSINESS WIRE)--Hagens Berman Sobal Shapiro LLP, an investor-rights law firm, is progressing in its investigation involving Life Partners Holdings, Inc. (NASDAQ GS:LPHI) shares and insurance policies.
Shareholders who purchased LPHI stock between May 29, 2007 and January 20, 2011 (the “Class Period”) or investors who purchased LPHI policies are encouraged to call Hagens Berman partner Reed R. Kathrein at 510-725-3000 for a personal consultation, or contact the Hagens Berman legal team at LPHI@hbsslaw.com.
“Our investigation has uncovered new information that support concern that Life Partners Holdings may have deceitfully profited from innocent investors,” said Mr. Kathrein. “As our investigation advances, we look forward to speaking with witnesses who can provide more details about these claims.”
On January 20, Life Partners Holdings Inc. confirmed in a company press release that federal regulators were investigating the insurance company. The company’s confirmation followed The Wall Street Journal article entitled, “SEC Probes Company Over Life-Span Data,” which reported that the Securities and Exchange Commission was looking into the way the company estimates the life expectancies of insured individuals.
In an earlier story published on December 21, 2010, The Wall Street Journal had also questioned the company’s life expectancy projections. The article, “Odds Skew Against Investors in Bets on Strangers' Lives,” indicated that Life Partners Holdings, Inc. may have “made large fees from its life-insurance transactions while often significantly underestimating the life expectancies of people whose policies its customers invest in.”
Life Partners Holdings, Inc., a Waco, Texas company, is engaged in the secondary market for life insurance, commonly called "life settlements." Life Partners Holdings, Inc. helps investors buy life insurance policies of terminally ill patients and the elderly at a discount of the policies' face value.
Hagens Berman seeks information regarding questions raised by The Wall Street Journal surrounding the accuracy of the methodology used by Life Partners Holdings, Inc. for its life-expectancy projections. The projections are important because the company can charge investors more for policies that have shorter life expectancies, and therefore faster payouts. If the insured individual's death comes later than estimated, the payout is delayed and investors must continue paying premiums, reducing their eventual returns.
According to news reports, Life Partners Holdings, Inc. uses a single physician based in Reno, Nev. to provide its life-expectancy estimates. An actuary interviewed by The Wall Street Journal stated that he had reviewed this physician’s work five years ago and had concluded that the Reno –based physician was using an “unrealistic” approach that tended to produce inaccurately short life expectancies. Hagens Berman welcomes any information regarding actual experience with the policies and their performance by investors, agents or policyholders.
Shares of LPHI dipped by $2.61, or about 17 percent, to $12.43 after Life Partners Holding, Inc confirmed the SEC investigation and The Wall Street Journal article. Today the stock trades for less than $10 per share. In December 2010, and prior to news articles from The Wall Street Journal, the LPHI stock traded as high as $18.34.
More details of the investigation can be found at http://www.hbsslaw.com/LPHI.
About Hagens Berman
Seattle-based Hagens Berman Sobol Shapiro LLP is an investor-rights class action law firm and represents whistleblowers in cases under the federal False Claims Act and state false claims acts. The firm also specializes in Wall Street Reform Whistleblower litigation. Hagens Berman has offices in Boston, Chicago, Colorado Springs, Los Angeles, Phoenix, San Francisco and Washington, D.C. Founded in 1993, HBSS continues to successfully fight for investor rights in large, complex litigation. More about the law firm and its successes can be found at www.hbsslaw.com. Visit the firm’s securities blog at http://www.meaningfuldisclosure.com.