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Life Partners Holdings Trustee Report Filed

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According to documents filed with the U.S. Bankruptcy Court, Life Partners Holdings’ Chapter 11 trustee filed a report detailing the results of his investigation of the Debtors’ pre-petition business conduct.

The trustee notes, “Life Partners was built by Brian Pardo and those acting in concert with him as a vehicle for profiting themselves at the expense of tens of thousands of individual investors, who were exploited, lied to, and misled at every turn. Many of the Investors who were hurt the worst are elderly Americans who relied on Pardo and his accomplices when they invested a material part of, or in some cases, all of their life savings with Life Partners.”

The report continues, “Life Partners also hid its massive fees and commissions, never disclosing that roughly one-third of all investment dollars were pocketed by Life Partners and its accomplices. Instead, Investors were led to believe that Life Partners used Investor funds to purchase the policies and to escrow for anticipated future premiums. Because Life Partners had misled Investors about the actual LE of the insureds, the Investors’ escrowed funds were rarely sufficient to pay the needed premiums….The financial devastation as of the bankruptcy petition date to the Investors was massive and continuing to grow. It will be decades before all of the policies in the Life Partners portfolio mature, and tens of millions of dollars in additional premiums will have to be expended in that time to preserve those policies. The Life Partners fraud deserves a place in Texas history as one of the largest and longest-standing fraud schemes ever perpetrated in this State. The scheme has already cost thousands of innocent Investors hundreds of millions of dollars, which in many cases represented a material portion of, or their entire, life savings.”

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