Attorney General Brian E. Frosh joined leading lawmakers and consumer and lead-paint-victim advocates on Thursday in support of legislation creating strong safeguards to protect against financial exploitation of injured Marylanders.
Attorney General Frosh testified before the House Judiciary Committee in support of legislation (HB 535/SB 734) that imposes new rules for transactions where financial firms offer a relatively small cash lump sum in exchange for a more-valuable stream of future payments obtained through the settlement of a personal injury lawsuit.
An investigation by the Office of the Attorney General has found that the transactions provide only a fraction of the value of the settlement to lead paint victims and others, and that victims may not be receiving the independent financial advice that current law requires. Finance companies often hide behind shell corporations which may not be registered to do business in Maryland.
“We can’t let the most vulnerable among us, including those whose brains have been harmed by the poison of lead paint, become victimized a second time,” Attorney General Frosh said. “These companies rely on aggressive marketing that entrap these victims. We can’t sit by while futures are stolen. We can do better.”
The legislation has the backing of Senate President Thomas V. Mike Miller Jr. and House Speaker Michael E. Busch.
“These common sense initiatives will provide some much needed safeguards for citizens all across our state,” said Senate President Miller. “I commend Attorney General Frosh for his continued leadership on issues such as these that protect our state’s consumers and most vulnerable communities.”
“Lead paint victims receive these settlements so that their future is protected for the long term,” said House Speaker Busch. “We need to close the loopholes that some companies are using to enrich themselves by taking away that long-term safety net.”
Frosh was joined by the Maryland Consumer Rights Coalition and the Green and Healthy Homes Initiative in backing the bill.
“Injured Marylanders need strong safeguards to ensure that they are not taken advantage of by predatory, unregulated companies,” said Robyn Dorsey of the Maryland Consumer Rights Coalition. “I’m very grateful to Attorney General Frosh for his efforts to ensure that these people have the protection they need for their long term financial well-being.”
“Lead-paint poisoning remains a permanent threat for many families in Baltimore and beyond,” said Ruth Ann Norton, executive director and CEO of the Green & Healthy Homes Initiative. “Many families are being duped into transactions they have no way of understanding. We need this law to end that immoral practice.”
The legislation supported by the Attorney General:
- Requires that victims receive independent advice on whether a proposed transfer is in their best interests;
- Requires that courts find that the transfer is in the best interest of the injured person, taking into account the welfare of dependents;
- Requires that applications for transfers be filed in the circuit court in the county in which the injured person resides;
- Authorizes the Office of the Attorney General to adopt and enforce regulations that protect injured plaintiffs.