May 30, 2002

RE: Financial Federated Status/Report No. 13

Dear Class Action Members, Victims and Creditors:

I am enclosing a check representing your pro rata share of the net settlement proceeds. The victims who filed timely claims and have been receiving distributions from me as Criminal Restitution Receiver and as Plan Administrator have now recovered approximately 16% of their losses.

Although the 16% recovery is considerably higher than the government expected when this case started, we are not finished. I eventually hope to get closer to a recovery of 20%, but both the amount and timing of future payments are uncertain. I want to provide a short summary of where we are now and what we are doing:

A. Sale of Seized Property: I have sold 22 homes, buildings, and lots and have only one home in South Carolina, one condo in Ft. Myers, and a few lots in Puerto Rico left to sell. The government completed its sale of the automobiles, helicopters, and watercraft last year. I am holding $4,235,026 in an account, while I wait for various criminal appeals to be concluded. It is possible some of these funds will be available for distribution before the end of the year, but it would require the cooperation of certain people serving time in prison.

B. Bankruptcy Litigation: I have filed almost 100 adversary cases in the Bankruptcy Court and have settled or litigated many of them. I also settled a few claims without filing an adversary proceeding. The lawsuits were against automobile dealers, brokers, jewelers, lawyers and just about anyone who received direct payments from FinFed without providing benefits to that company. After reserving for pending fee applications and costs, and including some escrowed funds I expect to receive, I have approximately $2 million in a bankruptcy-related account. I have a number of cases set for mediation and trial and hope I will collect more funds for you. My counsel is also exploring a lawsuit, perhaps with a class of victims, against the bank that handled most of FinFed's money. I would like to conclude outstanding litigation within the next year, but I will not settle cheaply just to expedite the process.

C. Viatical Contracts: Since being appointed Bankruptcy Trustee, I have collected $1,338,463 as policies matured. I have also received $1,028,750 from the sale of certain policies, and have one sale pending with an investor, that will result in another $150,000 in proceeds. At the same time, I have had to pay $180,212 in premiums to maintain the policies. I continue to try to sell the remaining policies, but expect to recover only a small percentage of their face value. Regrettably, the cars and homes Mr. Brandau and others bought for their own use ended up being more valuable than the viatical policies they overpaid for at the very end, when the government was closing in on them.

Lastly, I am pleased to inform you that, since my last status letter, the remaining Defendants in the criminal action were sentenced. On April 8, 2002 Zane Balsam was sentenced to 30 years. Attorney Garland Hogan was sentenced to 27 years and Alan Lewis was sentenced to 12.5 years. The U.S. Attorneys Office, FBI and U.S. Marshals Office did an outstanding job identifying seized assets, prosecuting the principals of FinFed and ABS, and then advocating long sentences. I am also pleased with my and your assistance in the sentencing process. Many of you wrote letters and packed the courtroom.

As always, if you have any questions concerning your check or matters discussed here, please leave my paralegal, Monica Bruce, a message on her direct line (305) 377-0661 and she will return your call as soon as practical. Remember, we have more than 3,500 victims, so please be patient. If you need an address updated, please send a note with your new location by mail to her attention at the above address and it will get properly noted in our records.

We know that you, as a victim, will never be made whole, but I hope the sentences handed down and the distribution checks make this disaster a bit easier on you. Thank you for your continuing support.

Please try to understand that it is unlikely I will make another distribution for several months. I will try to send you an update in October or November, but please do not count on another check being included.

Very truly yours,

John W. Kozyak