Costa Rican bond company Provident Capital Indemnity was involved in the collapsed A&O Life Investment Fund. According to the SEC, Provident is now involved in another collapsed life settlement "investment."
Here is the SEC’s Complaint filed in Texas against American Settlement Associates, Charles Jordan and Kelly Gibson. The complaint alleges that the defendants sold fractional ownership interests in a viatical policy and then did not use the investors’ money to cover future premium payments on the policy. Instead, the defendants used the investors’ money to support defendants’ lavish lifestyles.
The complaint alleges that defendants raised over $3.7 million from more than 50 investors in 10 states. The defendants promised a fixed rate of return of between 42% and 48%.
How in the world could anyone believe that they could get that kind of guaranteed investment return? If someone promises you that kind of return, then you need to hold onto your wallet and run.
As in the A&O debacle, the defendants assured investors that the investment was protected by a bond issued by Provident Capital. The complaint alleges that Provident Capital is unreliable, has a checkered regulatory history, and is banned from California.
In all likelihood, this is another life settlement investment scheme that will leave insurance agents collecting large premiums and investors holding the bag.