JOHN W. KOZYAK
PLAN ADMINISTRATOR FOR
FINANCIAL FEDERATED TITLE & TRUST, INC.
BANKRUPTCY CASE NO. 99-26616-BKC-RBR
AND
RESTITUTION RECEIVER IN U.S. V. BRANDAU, ET AL.
U.S. DISTRICT COURT NO. 99-8125-CR-HURLEY/JOHNSON(S)

Dear Victims:

In my last status report dated December 22, 2004, I promised at least one more distribution and hoped to make the final payment before the end of 2005. I know you are anxious to receive more money and that many of you are waiting to inform your tax professionals that the case is closed. It costs several thousand dollars to mail a status report to the approximately three thousand victims, so I have hesitated to do so. However, it has been too long since I have communicated with many of you and I apologize.

The individuals who were convicted for defrauding you appealed to the Supreme Court of the United States and the highest court remanded the sentencing portion of their judgment to the Circuit Court of Appeals and now the convicted felons will need to be re-sentenced. This means that there will be a delay in issuing the final distribution, because all appeals must be concluded before I may distribute the proceeds from the remaining, forfeited assets. While I understand this delay is a disappointment, I have no control over the appeals and I am not involved in this process. A date for re-sentencing will be posted on the website www.finfedinfo.com. The criminals are still in the Federal Bureau of Prisons.

Bankruptcy Assets Remaining

I have marketed the remaining viatical portfolio, but the low offers were rejected by the post-confirmation Creditors’ Committee and me. I recently filed a motion compelling the viators to provide updated medical records. I will be in a position to re-market the portfolio by this summer and hope to receive higher bids, because potential bidders will have more current medical information. I have previously informed you that the resale market value for viaticals is much less than the face value of the remaining life insurance policies, $13.4 million dollars. The industry resale average is now approximately 4-8% of face value. By holding onto the portfolio, and processing the death claims of matured policies, it has been more profitable than had I sold to the highest bidder. Nonetheless, I will re-market the policies this summer.
Distributions and Final Payments

I am maintaining $3,355,414.18 in low interest bearing accounts, which represents the proceeds of real estate seized by the government and is being held pending the resolution of the criminals appeals.

I am also holding $1,995,715.77 in Bankruptcy distribution funds. In addition to the funds to be collected on the sale of the viatical, I have three open litigation matters, which I am receiving payments as the result of settlements entered.

I understand that you may have questions regarding your final distribution and tax consequences, but I am not able to offer tax advice. Please ask your tax professionals any questions you may have relating to final close out. As always, if you have any questions, please leave my paralegal, Monica Bruce-Ramdath, a message on her direct line (305) 377-0661 and she will return your call as soon as practical. If you need an address updated, please utilize the enclosed Change of Address Notice slip.

Lastly, please try to understand that it is unlikely I will make the final Bankruptcy distribution for months and I can not be more specific at this time. For those of you with computer access, please remember to periodically visit the website at www.finfedinfo.com for updates. A family member or friend may also be able to print the pages out for those without computer access. Thank you.