I think it is a matter of time before the market figures out what Imperial is doing. Maybe the shorts have it already figured out! The Imperial business model appears to be a house of cards. That is likely why Imperials two major shareholders recently baled out. That was a bad omen. Do you know more than these significant shareholder which jumped ship?
It appears that on the structured settlement payment side of the Imperial business is engaged in similar financial games as are being played with the life settlement side. Has anyone yet seen a state attorney general investigation on this side of the business, which is even more precarious than the life settlement side. Today a Texas court again slammed Imperial's business practices which further weakens its business model. Imperial wants to bind customers to its purchase agreements -- generally signed up before the customer understands he is being underpaid -- and stop the customer from shopping his deal in a manner violate of the law in virtually ever state. That is why the Texas court today slammed Imperial, which is now scrambling to avoid a significant adverse judgment.
It appears that Imperial is manipulating its accounting by buying life contingent payments until annuitants' ages as old as 85 years old and booking profits based upon this hypothetical life expectancy. Does anyone have more information on this. This is one of the ways in which Imperial is able to record annual discount rates of 18%, maybe as much as 33% higher than the rest of the industry.
From what we can see, Imperial loses money on every structured settlement it buys.