Pre-Paid Legal Services
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| Type | Public (NYSE: PPD) |
|---|---|
| Founded | 1972 |
| Headquarters | Ada, Oklahoma |
| Key people | Harland Stonecipher (founder, CEO, chairman) |
| Industry | legal insurance |
| Products | Legal services, Identity theft restoration |
| Revenue | $461M |
| Employees | 813 Full Time |
| Website | http://www.prepaidlegal.com |
Pre-Paid Legal Services, Inc. NYSE: PPD is a corporation that offers specialized insurance and legal service products in the United States and Canada. The firm was founded on August 8, 1972, it it went public in 1984. Pre-Paid Legal Services, Inc. is a member of the S&P 600 SmallCap index and the S&P 1500 Super Comp index.
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[edit] Company Description
Pre-Paid Legal Services, Inc. develops, underwrites and markets legal service plans through a network of more than 50 independent law firms across the U.S. and Canada. The plans provide for legal service benefits, including unlimited attorney consultation, letter writing, document preparation and review, will preparation, traffic violation defense, automobile-related criminal charges defense and a general trial defense. The Company also markets an identity theft identity theft monitoring and restoration services .Currently most of the company's products are sold through the network marketing system (also known as multi-level marketing). Products are also sold as an employee benefit through payroll deduction.
[edit] History
Pre-Paid Legal Services began on July 11, 1969 when CEO and founder Harland C. Stonecipher was involved in a vehicle accident which left him with legal bills. He began researching the industry of European legal expense plans. On August 8, 1972, Harland Stonecipher created Pre-Paid Legal’s predecessor, The Sportsman’s Motor Club, offering legal expense reimbursement services as a motor service club. Pre-Paid Legal started selling plans through network marketing in 1983. Pre-Paid Legal went public on the NASDAQ National Market System in 1984, and two years later moved to the American Stock Exchange. On May 13, 1999, Pre-Paid Legal moved to the New York Stock Exchange, and within four months was listed as the 33rd fastest growing company on the NYSE, according to Equities Magazine. In 2000, Pre-Paid Legal made the Forbes list of the 200 Best Small Companies in America for the fifth year in a row. In 2007, Pre-Paid Legal made the Forbes list of the 200 Best Small Companies in America again. The company currently provides services in all 50 states, Washington, D.C., and five provinces in Canada, with over 1.7 million members.
[edit] Criticism
Pre-Paid Legal has come under fire by both former members and legal authorities, charging fraud, deception, and accounting irregularities.
- In 1997, after a FTC investigation, Pre-Paid Legal admitted misleading customers and suspended sales of living trusts.[1]
- In 2001, the Wyoming Attorney General classified Pre-Paid Legal as a "multi-level marketing" organization and won refunds for multiple customers who were defrauded by misleading earnings claims.[2][3]
- Pre-Paid Legal has faced ongoing troubles in Missouri. After the company settled complaints in 2001,[4] a number of similar suits arose. The company won in a jury trial against two plaintiffs[4], but would later settle with more than 400 others, including one customer who was awarded $9.9 million. The company, and the U.S. Chamber of Commerce of which Pre-Paid Legal CEO Harland Stonecipher is a director,[5] have described the lawsuits against the company as "frivolous" and "abusive".[6]
[edit] Sources
- Smith, Melissa. "Pre-Paid Weathers Guilty Verdict". thestreet.com.
- MacMillan, Hoke. "Attorney General’s Office Nets Refunds From Multi-Level Marketer". attorneygeneral.state.wy.us.
- Rozett, Lisa. https://wsecure.prepaidlegal.com/pdf/usachamber.pdf . US Chamber of Commerce.
- Forbes. "Forbes 2007 Best 200 Companies in America". Forbes.com.
- Forbes. "Forbes 2008 Best 200 Companies in America". Forbes.com.
- Pre-Paid Legal. "Pre-Paid Legal Advisory Council". PrepaidLegal.com.
- Corsi, Jerome. "Prepaid Legal: From A Novelty to An Accepted Insurance Marketing Opportunity". Broker World.
- http://www.shareholder.com/ppd/ReleaseDetail.cfm?ReleaseID=205437
- http://wserver0.prepaidlegal.com/newCorp2/about_us/advisory_council.html
[edit] References
- ^ http://www.nytimes.com/2006/11/13/business/13short.html
- ^ http://findarticles.com/p/articles/mi_qn4188/is_20081030/ai_n30951143
- ^ http://attorneygeneral.state.wy.us/CPU1PR113001.pdf
- ^ http://www.thestreet.com/_yahoo/stocks/melissadavid/10189148.html
- ^ http://www.uschamber.com/press/releases/2005/june/05-109.htm
- ^ http://www.uschamber.com/press/releases/2004/november/04-152.htm
