Profiting From Death Bonds

03/28/2008 02:46 am ET | Updated May 25, 2011

Selma Mannheim is one of a growing number of older Americans and their relatives who are taking advantage of a booming life-settlement industry that involves buying, selling and profiting from life insurance policies.

Not everyone is enchanted with the idea of selling life insurance policies to faceless investors.

"You ought to know who you sell to. You don't want Tony Soprano buying your life insurance policy," said Newport Beach attorney Jay Adkisson, who writes about financial fraud on an Internet blog called "I don't like the idea of people growing life insurance like so many crops."

These agreements also have riled insurance companies and threatened their profits.

Investing in people's lives and collecting on their deaths is a growing enterprise. As investors began to pool these investments and sell them as a package, these securities soon attracted hedge funds, pension funds and institutional endowments.

Read about how scammers are taking advantage of "Death Bonds"

Read Newsweek's 2007 cover story on death bonds.

Suggest a correction