Five years after initiating civil action against a Maryland company buying lead paint victims’ settlements for a fraction of their value, the state Attorney General’s Office has obtained criminal indictments against three of the company’s officials.
Access Funding’s practices were thrust into scrutiny in 2015 after the death in Baltimore of Freddie Gray from injuries suffered in police custody.
Lead paint victims are awarded settlements that are paid out over time to ensure that the money is not spent all at once, but Access Funding would pay out a smaller lump sum to obtain the rights to the more valuable long-term settlement. Gray and his siblings were among those who sold their settlements. They sold $435,000 of their settlements for about $54,000, a deal approved by a Prince George’s County judge.
The Attorney General’s Office sued the company and a number of its officials in 2016, a case that continues to wind through the courts.
Now, Raffi Michael Boghosian, 43, of Rockville, Charles Edward Smith Jr., 43, also of Rockville, and Anuj Sud, 43, of Laurel are facing charges of theft scheme over $100,000 and conspiracy to commit theft scheme over $100,000 after being indicted in Baltimore Circuit Court. The indictments were returned Monday.
Civil attorneys for the three men declined to comment on the indictment or pending civil litigation.
It’s not clear why the office moved forward with criminal charges now.
Attorney General Brian Frosh said in a statement that the operators of Access Funding “preyed” on victims of lead paint poisoning and “deprived the victims of their vital lifelines” for long-term support for their injuries.
In a news release, the Attorney General’s Office said the charges relate to the acquisition of structured settlement payment rights valued at over $21 million belonging to 95 individuals. In exchange for their payment rights, Access Funding gave the owners a total of less than $7 million. In some cases, lead paint victims received just 8% of the value of their settlement.
The charges allege that Boghosian, Smith and Sud prevented the 95 payment rights owners from receiving the independent professional advice that is a legal prerequisite for the transfer of structured settlement payment rights.
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Smith, an attorney, is accused of falsely claiming that he had provided independent professional advice to the rights owners in petitions for transfer of payment rights filed by Access Funding between June 2013 and May 2015.
“Most such letters provided by Smith falsely stated that Smith met a number of statutory requirements to provide independent professional advice,” the indictment alleges. Smith was not an independent adviser, but was close friends with Boghosian and Sud and was getting paid by the company for his work, according to the indictment.
The indictment alleges Smith provided letters to Boghosian, a part owner of the company, who had them filed in court by Sud, who was also an attorney.
Sud has since been disbarred, after being charged by federal prosecutors with taking bribes as a member of the Prince George’s County liquor board. He pleaded guilty and in 2018 was sentenced to four years in federal prison. He was released in February 2020.
The Washington Post called attention to Access Funding’s practices in 2015. Frosh’s office said it obtained internal emails showing the company wanted to “own” the lead paint market in Baltimore. The company posted 22 billboards throughout the city in the course of one month in 2013, urging victims of lead poisoning to “GET CASH NOW.”
In the company’s manual, employees were instructed to remember that their customers “do not generally have the peace of mind in their lives that comes with financial stability.”
“Take this as a positive and take full advantage,” the manual said. “You are their savior.”