Citizens are contacting the state asking how to sign up to receive a share of the Tobacco Master Settlement Agreement (Tobacco MSA). Any advertising suggesting that you can sign up and directly receive Tobacco MSA settlement money is false: only states, not individuals, receive MSA payments.
Many of the inquiries about this appear to be coming from online material. The promotional materials misleadingly suggest that individuals can access money from the Tobacco MSA—whether they smoked or not.
This Alert gives you information on how to spot and stop this Tobacco MSA scam.
About twenty years ago, the big tobacco companies signed an agreement with all of the state Attorneys General to settle lawsuits that states had filed to limit tobacco advertising and to recoup tobacco-related health care costs.
According to the terms of the agreement, settlement monies are paid directly to the states (and five U.S. territories). But there is no settlement fund that will give individuals money. The settlement with the tobacco industry does not prevent individuals from filing lawsuits on their own behalf.
The advertising promotes an investment opportunity, but that detail is only briefly noted after you are thinking about lottery-like payments.
Most states have borrowed against the anticipated revenue from future Tobacco MSA payments, so there are many municipal tobacco settlement bonds you can buy. When you buy a municipal tobacco settlement bond, you are lending money to the state and in return you receive tax-free municipal bond interest that is backed by the perpetual cash flow from the tobacco settlement payments.
The goal of one promoter is to get consumers to purchase a newsletter subscription describing how to access the Tobacco MSA money ($4.95 for the first month and then $99 for a one-year subscription). Some Better Business Bureau reports suggest that once a consumer provides credit card information for a subscription, it is difficult to cancel.
If you have been the victim of a Tobacco MSA scam, or if you would like to file a complaint, please contact the Michigan Department of Attorney General:Consumer Protection Division
The Attorney General provides Consumer Alerts to inform the public of unfair, misleading, or deceptive business practices, and to provide information and guidance on other issues of concern. Consumer Alerts are not legal advice, legal authority, or a binding legal opinion from the Department of Attorney General.