Securities and Exchange Commission v. Life Partners, Incorporated and Brian D. Pardo

Opinion for the Court filed by Circuit Judge GINSBURG.

Dissenting Opinion filed by Circuit Judge WALD.

GINSBURG, Circuit Judge:

A viatical settlement is an investment contract pursuant to which an investor acquires an interest in the life insurance policy of a terminally ill person — typically an AIDS victim — at a discount of 20 to 40 percent, depending upon the insured’s life expectancy. When the insured dies, the investor receives the benefit of the insurance. The investor’s profit is the difference between the discounted purchase price paid to the insured and the death benefit collected from…