IRVINE, Calif. - (Business Wire) Mutual Credit Corporation (MCC), its President Anthony Jacobson, and its affiliates today announced a favorable resolution of litigation with two of MCC
’s borrowers under its non-recourse premium financing plan, Donald Kueltzo and Harry L. Jenkins and the trustees of their respective life insurance trusts. In the Kueltzo action, the Orange County Superior Court entered a judgment of foreclosure against Kueltzo, and a similar judgment was entered in the separate Jenkins action. The judgments acknowledged the validity and enforceability of MCC financing.
Non-recourse premium financing refers to a widely-used method for senior citizens to purchase a high-value life insurance policy using funds borrowed from MCC and related entities. At the end of the loan term, the policy holder has the option of repaying the loan and retaining ownership of the policy, selling the policy to a third party (a life settlement provider), or instead of repaying the loan, transferring ownership of the policy to MCC as full payment of the loan and retaining substantial equity in the policy which MCC advances at the inception of the loan.
Both Kueltzo and Jenkins, and representatives who spoke on their behalf to the media, confirmed that they became involved in litigation prior to having the benefit of discovery relating to MCC’s non-recourse premium financing business. Having now engaged in full discovery, Kueltzo and Jenkins are satisfied with the way in which MCC and Jacobson conducted that business and agree that all of the terms of the non-recourse premium finance transactions were fully disclosed.
“MCC’s non-recourse premium financing is a valuable estate planning tool that provided me with the ability to obtain a significant amount of life insurance. This life insurance provided me, as well as my family, with an important safety net of coverage which I was able to finance through MCC,” said Donald Kueltzo.
Harry Jenkins also acknowledged that MCC’s non-recourse premium financing provided him with a valuable estate planning tool: “MCC financing allowed me to obtain a substantial amount of life insurance without having to divert funds from other investments toward premiums to purchase such insurance. I understand the value of those benefits and believe that the terms of MCC’s loans were both fair and reasonable.”
“We are pleased with the favorable resolution of these matters and the recognition by Mr. Kueltzo and Mr. Jenkins that our non-recourse premium financing provides valuable benefits to borrowers,” said MCC’s President, Anthony Jacobson. “Hopefully the favorable judgments in these two cases will help to repair some of the damage caused to the premium finance and life settlement industries by the false allegations asserted against MCC.”
The judgments state that the loan agreements which are part of MCC’s non-recourse premium financing are valid and enforceable, and result in the dismissal of all claims against MCC by Mr. Kueltzo and Mr. Jenkins and their respective life insurance trusts.
MCC
Lisa Fuller, 949-684-1652
General Counsel
