Stephen Pauwels, BridgePoint Financial Services | November 17, 2014 | Posted in News Updates
BridgePoint Financial was recently invited by the Ontario Trial Lawyers Association (OTLA) Board of Directors to present and discuss its services at their most recent meeting on October 20, 2014 in Toronto. The purpose of the meeting was to assist OTLA in considering its position on the litigation lending industry in light of the BC Trial Lawyers Association’s decision to restrict litigation finance companies from marketing through their organization.
The following is taken from the presentation made by Stephen Pauwels, Principal of BridgePoint Financial.
"To fearlessly champion, through the pursuit of the highest standards of advocacy, the cause of those who have suffered injury or injustice... to promote access to justice for all Ontarians, preserve and improve the civil justice system, and advocate for the rights of those who have suffered injury."
To offer responsible financing and risk management solutions to meet the specialized needs of personal injury plaintiffs, their lawyers, and experts... protecting the rights to full and fair access to justice.
In essence, everything BridgePoint does is intended to help lawyers in advocating for accident victims and promoting access to justice.
In our presentation package you will find an overview of the various services we offer which are applicable to personal injury litigation.
I would first like to discuss what is easily the most contentious of these services – settlement loans. These are the loans that address your clients’ personal financial needs pending the resolution of their claims. They have a bad reputation in the legal community, and for the most part deservedly so. This is a market that needs cleaning up. Every injury lawyer in the country by this point has a horror story of a client who borrowed too much money, too early in the litigation, at too high an interest rate which snowballed into a disaster by the time of settlement.
But please understand this simple fact, if nothing else I say here today – not all litigation lenders are the same. Just as there are good and bad lawyers practicing out there, and good and bad rehab providers, there are, not surprisingly, good and bad litigation lending companies. And any lawyer who presumes to paint us with the same brush is either exceptionally lazy or exceptionally naïve, and unfortunately that ignorance is being paid for by their clients.
I won’t spend my little time here citing and comparing our specific loan terms relative to our competitors – that information is easily available in your materials and certainly on our website. I simply want to stress this point: Lawyers need to educate themselves on the differences between the lenders who are out there because your clients will not. Once they are online googling “lawsuit loan” or “personal injury advance” at two in the morning they are too vulnerable to make responsible decisions. Who can blame an accident victim whose income replacement benefits have been terminated and who is struggling to put food on the table from taking the bait of “fast and easy” money just a mouse click away?
They need your guidance.
It amazes me how many lawyers still feel that their clients’ financial issues aren’t their problem or “not what they are being paid for”. I sincerely don’t understand that mentality. Your clients’ financial predicament can be as attributable to their accident as their physical and psychological impairments. And if it is part of your mandate to guide them to the resources to cope with those issues, why is it not be to assist them in addressing the inevitable financial hurdles most will face throughout the litigation?
I am not holding up BridgePoint as a poster child. We aren’t inexpensive relative to bank financing that most of us take for granted. Though we are relative to other litigation lending companies out there which are often the last line of defence for your clients before capitulating to a low ball settlement offer.
Like you do, we advise your clients to examine all alternatives before borrowing against their future settlement. Where a settlement loan is the only option available, here are a few of the standard best business practices you should know we abide by:
Our loans are first and foremost intended as a lifeline to keep a plaintiff’s head above water during the critical final stage of their litigation when their benefits have been exhausted, their savings wiped out and where they are most vulnerable to opportunistic lowball settlement offers. That’s what this business should be about. Not about excessive interest rates, confusing surcharges and fees, taking advantage of the desperate and vulnerable or encouraging plaintiffs to treat their litigation like an ATM machine throughout the litigation.
OTLA can’t regulate the rates that plaintiffs are going to pay in this market. However, that doesn’t mean there isn’t a strong role for you to play in cleaning it up. Why not promote a code of conduct to be agreed upon by any lender seeking access to your association? Require lenders to be up front and transparent about the actual cost of their money. Discourage teaser interest rates that step up over time, or hidden charges only disclosed in fine print. Make US earn YOUR stamp of approval or endorsement that we can display on our website as a vote of confidence. It would be telling of those who don’t have it or who don’t care to try.
Please DO NOT follow the BCTLA example because that model has failed miserably. Plaintiffs certainly do not borrow less in that market. Quite the opposite in fact. They just borrow in the dark now where the predatory lenders prefer to operate. The lawyers and plaintiffs in that market are easily the least informed in the country as far as third party litigation funding solutions that can play a strategic role in financing vital medical and rehab services for example, or leveraging advances from tort insurers. Not so coincidentally it is also a common practice in BC (as nowhere else in Canada) for lawyers to lend money to their own clients for disbursements (at rates that exceed ours in many instances). The BC Ethics Committee also recently gave a green light for law firms in BC to offer personal loans to their own clients’, raising some concerning conflict of interest considerations.
OTLA has the opportunity to make a much more enlightened decision that befits your mission statement and we hope and trust you will do so.
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NATIONWIDE LENDING SERVICES available in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland & Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Yukon Territory. PLAINTIFF LENDING SERVICES are commonly referred to as Settlement Loans, Personal Injury Loans, Lawsuit Loans, Pre-settlement Loans, Litigation Loans, Litigation Lending, Personal Injury Funding, Personal Injury Advances, Law Firm Loans, Law Firm Financing, Law Firm Funding, Legal Funding, Legal Loans, Legal Financing, Litigation Funding, Litigation Financing, Settlement Advances, Settlement Financing. BridgePoint Financial Services provides innovative financing and risk management solutions for the Canadian market (Canada).