03-29-2012, 10:26 PM | #1 | ||
Death Herald
Join Date: Nov 2000
Location: Le stelle la notte sono grandi e luminose nel cuore profondo del Texas
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WTF: Okie State's losing gamble
This has to be the strangest way I've heard of an athletic department losing money.
OSU Cowboys' Death Wish Goes Unanswered, Lose $33 Million - Forbes
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Thinkin' of a master plan 'Cuz ain't nuthin' but sweat inside my hand So I dig into my pocket, all my money is spent So I dig deeper but still comin' up with lint |
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03-29-2012, 11:33 PM | #2 |
Coordinator
Join Date: Nov 2003
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Wealthy booster: so what can I do to help the team this year?
OK St AD: eat as much bacon as you can, don't look before you cross the street and don't bother taking those heart meds for a while Wealthy booster: ? |
03-30-2012, 01:15 AM | #3 |
Head Coach
Join Date: Sep 2004
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That's just bizarre. And fascinating in a macabre way.
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03-30-2012, 02:26 AM | #4 |
Grizzled Veteran
Join Date: Nov 2006
Location: Minnesota
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I am kind of surprised the life insurance company even allowed them to insure the boosters.
Must be insurable interest for them to allow a policy. Its not as if the boosters are family members or really business partners that owed the school money or something. In any case this sort of seems kind of wrong. Betting on some of your top boosters dying so you can profit. |
03-30-2012, 04:48 AM | #5 |
This guy has posted so much, his fingers are about to fall off.
Join Date: Nov 2000
Location: In Absentia
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My guess is this is likely akin to a "key man" policy a corporation would take out on an executive. They must have shown that the boosters were worth a stream of cash to the school. Plus the donors no doubt consented to the insurance policy being issued. They should have sold the policies to a viatical settlement company!
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M's pitcher Miguel Batista: "Now, I feel like I've had everything. I've talked pitching with Sandy Koufax, had Kenny G play for me. Maybe if I could have an interview with God, then I'd be served. I'd be complete." |
03-30-2012, 05:54 AM | #6 |
Hall Of Famer
Join Date: Apr 2002
Location: Back in Houston!
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So you're saying insurance companies are good at what they do, with the actuarial tables and all? I am shocked
SI
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03-30-2012, 07:20 AM | #7 |
Registered User
Join Date: Nov 2001
Location: Here
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Shot, I knew I should have taken a policy out on asteve Jobs when I had the chance.
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03-30-2012, 07:36 AM | #8 | ||
College Prospect
Join Date: Nov 2006
Location: High and outside
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This:
Made me read this: Quote:
Quote:
/Hitman 2 |
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03-30-2012, 07:38 AM | #9 | |
This guy has posted so much, his fingers are about to fall off.
Join Date: Nov 2000
Location: In Absentia
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Quote:
"But I have an insurable interest in the value I place on my future entertainment!"
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M's pitcher Miguel Batista: "Now, I feel like I've had everything. I've talked pitching with Sandy Koufax, had Kenny G play for me. Maybe if I could have an interview with God, then I'd be served. I'd be complete." |
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03-30-2012, 08:00 AM | #10 |
Head Coach
Join Date: Oct 2000
Location: North Carolina
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I've heard of this before.
Most states now have laws saying that the life-in-interest has to be aware that a policy is out on them. Give them a fighting chance and all that. |
03-30-2012, 08:14 AM | #11 |
This guy has posted so much, his fingers are about to fall off.
Join Date: Nov 2000
Location: In Absentia
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There's that, but it's far more complicated than that. That's where the viatical stuff comes in. Some people will willingly either take out a policy themselves or consent to one being taken out on them, then immediately sell it to an unrelated 3rd party for cash. That's typically been against public policy for hundreds of years as a wagering contract. There was a big fight at the NAIC level (national association of insurance commissioners) to amend its model laws on this stuff to place a 5-year limitation on the sale/transfer of such a policy to cut down on an investor's interest in pre-funding the initial premiums to purchase the policy (the theory being that if you make them wait 5 years for a return, the deal isn't such a great investment).
Most insurance companies are actually against this kind of thing, since it is usually a bad deal for insureds and, in the extreme, can subject one to the potential of the people holding your policy wanting you dead as soon as possible and acting on that (and, of course, messing with the actuarial t ables and causing earlier payouts than predicted). The reason someone with an "insurable interest" can procure a policy on your life without your consent is the (perhaps outdated) idea that they have a reason for you to live (wife, son, father, etc.) apart from a solely monetary one and don't just want you dead. When you viate a policy, you could be agreeing to additional transfers of that policy to people who are entitled to information about your health status, whereabouts, etc., and who could be tied to the mob. And if you die tomorrow and pay off $5M on their $250K investment from just 3 months ago... well that would just be a shame, wouldn't it?
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M's pitcher Miguel Batista: "Now, I feel like I've had everything. I've talked pitching with Sandy Koufax, had Kenny G play for me. Maybe if I could have an interview with God, then I'd be served. I'd be complete." Last edited by Ksyrup : 03-30-2012 at 08:16 AM. |
03-30-2012, 08:36 AM | #12 |
Head Coach
Join Date: Oct 2000
Location: North Carolina
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I took an insurance law class and remember the professor saying that in Olde England during a capital murder trial there would be booths outside the courthouse where people could buy short-term life insurance contracts on the defendant.
Apparently, back then, once you were found guilty, they killed you pretty much right then. So the "life insurance" was really just a way to legally gamble on the outcome of the trial. That story was a lot more fun when I thought of it as something from back in the day. Picturing Tony Saprano with a viable interest in some random guy in New Jersey having an accident? Not as much fun. |
03-30-2012, 08:46 AM | #13 |
This guy has posted so much, his fingers are about to fall off.
Join Date: Nov 2000
Location: In Absentia
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When I practiced in Florida, I got involved in some of the initial laws/rules the DOI had to enforce/promulgate to try to rein in the industry and some of the practices they were using (one of my good friends from the Department became the "guru" on the industry after I left). In private practice, my firm was the receiver for a viatical company that went insolvent (there was a ton of fraud involved - clean-sheeting (fraudulently applying for insurance policies by failing to disclose terminal illnesses, etc.) and the like), and I learned way more than I ever wanted to know about the industry.
I still remember the main guy in our firm who handled the case on-site telling us about finding a drawer filled with country flags that the company would fly when potential investors would come in to visit them, and finding a Vatican flag among them. I don't know if the The Vatican has or is invested in viaticals, but they were interested enough to visit one, at least. That just blew my mind.
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M's pitcher Miguel Batista: "Now, I feel like I've had everything. I've talked pitching with Sandy Koufax, had Kenny G play for me. Maybe if I could have an interview with God, then I'd be served. I'd be complete." Last edited by Ksyrup : 03-30-2012 at 08:47 AM. |
03-30-2012, 08:52 AM | #14 |
Coordinator
Join Date: Sep 2003
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It would be awesome if it turns out that the insurance company they lost all of this money to was owned/operated by an Oklahoma booster.
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03-30-2012, 09:21 AM | #15 |
This guy has posted so much, his fingers are about to fall off.
Join Date: Nov 2000
Location: In Absentia
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Ironically, Oklahoma's insurance department was run by a corrupt commissioner back about a decade ago. One of our clients at the time got majorly fucked by him and his campaign coordinator/attorney and ended up losing his insurance company because of it. So I wouldn't necessarily dismiss that possibility...
Former Insurance Commissioner Carroll Fisher sentenced to 6 months | NewsOK.com
__________________
M's pitcher Miguel Batista: "Now, I feel like I've had everything. I've talked pitching with Sandy Koufax, had Kenny G play for me. Maybe if I could have an interview with God, then I'd be served. I'd be complete." |
03-30-2012, 10:19 AM | #16 |
Coordinator
Join Date: Oct 2000
Location: Big Ten Country
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I question the idea that they have an insurable interest, really. These boosters are just sitting on money, right? So if the booster dies, I'm guessing a large sum is already on its way to the school via the booster's will. And the income from this money is still there, so depending on who takes over, a similar stream may be coming in.
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03-30-2012, 10:20 AM | #17 | |
Grizzled Veteran
Join Date: Nov 2006
Location: Minnesota
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Quote:
This is exactly what I was thinking. I bet Okie St is ashamed that this info is now public knowledge. Last edited by jbergey22 : 03-30-2012 at 10:21 AM. |
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03-30-2012, 07:27 PM | #18 |
Hall Of Famer
Join Date: Apr 2002
Location: Back in Houston!
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Welcome to Human Credit Default Swaps!
SI
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Houston Hippopotami, III.3: 20th Anniversary Thread - All former HT players are encouraged to check it out! Janos: "Only America could produce an imbecile of your caliber!" Freakazoid: "That's because we make lots of things better than other people!" |
03-30-2012, 07:35 PM | #19 |
Hall Of Famer
Join Date: Jun 2006
Location: Chicago, IL
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It's a common practice. Look up "Dead Peasan insurance". Companies will buy a bunch of life insurance policies on their employees. Not executives either, but low level employees who are not vital at all to a company. It's an investment scheme since the life insurance policies provide good tax credits/deductions. It is incredibly common, just not a lot of people know about it. Your employer might have one on you right now.
sterlingice is correct that it's human credit default swaps. |
03-30-2012, 08:24 PM | #20 |
Coordinator
Join Date: Jul 2004
Location: Pacific
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What I got out of it, is that Iowa is 20th on the list of most valuable college football teams.
Go Hawks! |
03-30-2012, 08:37 PM | #21 |
Death Herald
Join Date: Nov 2000
Location: Le stelle la notte sono grandi e luminose nel cuore profondo del Texas
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I know it is common with corporations, but this is the first I've heard of a school doing this with their boosters.
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Thinkin' of a master plan 'Cuz ain't nuthin' but sweat inside my hand So I dig into my pocket, all my money is spent So I dig deeper but still comin' up with lint |
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