Enforcement of life settlement contract provisions
- • reporting of violations
- • required antifraud initiatives
(1) A person may not knowingly or intentionally interfere with the enforcement of the provisions of ORS 744.318 (Definitions for ORS 744.318 to 744.384) to 744.384 (Rules), 744.991 (Criminal penalties) and 744.992 (Civil penalties) or investigations of suspected or actual violations of ORS 744.318 (Definitions for ORS 744.318 to 744.384) to 744.384 (Rules), 744.991 (Criminal penalties) and 744.992 (Civil penalties).
(2) A person in the business of life settlements may not knowingly or intentionally permit any person convicted of a felony involving dishonesty or breach of trust to participate in the business of life settlements.
(3) Life settlements contracts and purchase agreement forms and applications for life settlements, regardless of the form of transmission, must contain the following statement or a substantially similar statement: “Any person who knowingly presents false information in this application is guilty of a crime and may be subject to fines and confinement in prison.”
(4) The lack of a statement as required in subsection (3) of this section does not constitute a defense in any investigation or prosecution for an act violating any provision of ORS 744.318 (Definitions for ORS 744.318 to 744.384) to 744.384 (Rules), 744.991 (Criminal penalties) and 744.992 (Civil penalties).
(5) Any person engaged in the business of life settlements having knowledge or a reasonable suspicion that a fraudulent life settlement act is being, will be or has been committed must provide to the Director of the Department of Consumer and Business Services information as required by, and in a manner prescribed by, the director.
(6) Any other person having knowledge or a reasonable belief that a fraudulent life settlement act is being, will be or has been committed may provide to the director the information required by, and in a manner prescribed by, the director.
(7)(a) No civil liability is imposed on and no cause of action arises from a person’s furnishing information concerning suspected, anticipated or completed fraudulent life settlement acts or suspected or completed fraudulent insurance acts, if the information is provided to or received from:
(A) The director or the director’s employees, agents or representatives;
(B) Federal, state or local law enforcement or regulatory officials or their employees, agents or representatives;
(C) A person involved in the prevention and detection of fraudulent life settlement acts or that person’s agents, employees or representatives;
(D) The National Association of Insurance Commissioners, the Financial Industry Regulatory Authority or the North American Securities Administrators Association, or their employees, agents or representatives, or any other regulatory body overseeing life insurance, life settlements, securities or investment fraud; or
(E) The life insurer that issued the life insurance policy covering the life of the insured.
(b) Paragraph (a) of this subsection shall not apply to statements made with actual malice. In an action brought against a person for filing a report or furnishing other information concerning a fraudulent life settlement act, the party bringing the action must plead specifically any allegation that paragraph (a) of this subsection does not apply because the person filing the report or furnishing the information did so with actual malice.
(c) A person furnishing information as identified in paragraph (a) of this subsection is entitled to an award of attorney fees and costs if the person is the prevailing party in a civil cause of action for libel, slander or any other relevant tort arising out of activities in carrying out the provisions of ORS 744.318 (Definitions for ORS 744.318 to 744.384) to 744.384 (Rules), 744.991 (Criminal penalties) and 744.992 (Civil penalties) and the party bringing the action was not substantially justified in doing so. For purposes of this paragraph, a proceeding is “substantially justified” if it had a reasonable basis in law or fact at the time that it was initiated. However, such an award does not apply to a person furnishing information concerning the person’s own fraudulent life settlement acts.
(d) This section does not abrogate or modify common law or statutory privileges or immunities enjoyed by a person described in paragraph (a) of this subsection.
(8) The documents and evidence obtained by the director in an investigation of suspected or actual fraudulent life settlement acts are privileged and confidential under ORS 705.137 (Information that is confidential or not subject to disclosure).
(9) This section does not:
(a) Preempt the authority or relieve the duty of other law enforcement or regulatory agencies to investigate, examine and prosecute suspected violations of law;
(b) Prevent or prohibit a person from disclosing voluntarily information concerning life settlement fraud to a law enforcement or regulatory agency other than the Department of Consumer and Business Services; or
(c) Limit the powers granted elsewhere by the laws of this state to the director or any other state department or agency to investigate and examine possible violations of law and to take appropriate action against wrongdoers.
(10)(a) Life settlement providers and life settlement brokers must have in place antifraud initiatives reasonably calculated to detect, prosecute and prevent fraudulent life settlement acts. At the discretion of the director, the director may order, or a licensee may request and the director may grant, such modifications of the required initiatives described in paragraph (b) of this subsection as necessary to ensure an effective antifraud program. The modifications may be more or less restrictive than the required initiatives as long as the modifications may reasonably be expected to accomplish the purpose of this section.
(b) Antifraud initiatives must include:
(A) Fraud investigators, who may be life settlement provider or life settlement broker employees or independent contractors; and
(B) An antifraud plan, which must be submitted to the director. The antifraud plan must include, but is not limited to:
(i) A description of the procedures for detecting and investigating possible fraudulent life settlement acts and procedures for resolving material inconsistencies between medical records and insurance applications;
(ii) A description of the procedures for reporting possible fraudulent life settlement acts to the director;
(iii) A description of the plan for antifraud education and training of underwriters and other personnel; and
(iv) A description or chart outlining the organizational arrangement of the antifraud personnel who are responsible for investigating and reporting possible fraudulent life settlement acts and investigating unresolved material inconsistencies between medical records and insurance applications.
(c) Antifraud plans submitted to the director are privileged and confidential under ORS 705.137 (Information that is confidential or not subject to disclosure). [2009 c.711 §17]
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.