Did Your Broker Recommend, Future Income Payments LLC (FIP)?

According to a press release from the United States Department of Justice, on August 18, 2022, a Judge from the U.S. District Court for the District of South Carolina sentenced Scott Kohn, 68, of Newport, California, to 10 years in prison for his role as the mastermind of a nationwide Ponzi scheme, Future Income Payments LLC (FIP), that exploited military veterans in desperate financial hardhship and targeted elderly investors seeking a safe retirement investment.

According to the DOJ, Kohn ran Future Income Payments LLC (FIP), formerly known as Pensions, Annuities, and Settlements LLC. From April 2011 until April 2018, Kohn and his co-conspirators used FIP as an instrument for a nationwide Ponzi scheme.   

The DOJ reported that Scott Kohn and his co-conspirators solicited pensioners experiencing financial problems, many were military veterans, by offering them an upfront lump-sum payment in exchange for the assignment of the rights to their monthly pensions and disability payments.  The transactions were labeled as sales, when in truth they were loans with annual interest rates up to 240%.

According to the DOJ, Scott Kohn and his co-conspirators, worked through a network of hundreds of financial advisors and insurance agents nationwide, and then solicited thousands of seniors to purchase Future Income Payments “structured cash flows,” which were the pensioners’ monthly pension payments. Scott Kohn and his co-conspirators recommended these seniors invest their retirement savings with Future Income Payments by making false assurances of a high rate of return on their investment, concealing the nature of FIP’s transactions with the pensioners, and lying about the financial stability of the corporation.

Scott Kohn and his co-conspirators caused over $310 million of losses in Future Income Payments to more than 2,500 retirees and put over 13,000 veterans into loans that exploited them.  Kohn lived a lavish lifestyle using FIP funds during the seven years he ran the scheme, according to the DOJ.

“The elaborate Ponzi scheme orchestrated by Kohn and his co-conspirators preyed upon both military veterans experiencing financial hardship and retirees hoping to protect their life savings,” said Principal Deputy Assistant Attorney General Brian Boynton, head of the Justice Department’s Civil Division. “The department is committed to protecting our military community and America’s seniors from fraud and abuse.”

“Kohn and his co-conspirators reached across the country to steal from veterans and seniors who desperately needed their money,” said U.S. Attorney Adair F. Boroughs for the District of South Carolina. “These hundreds of millions in losses will reverberate through the victims’ lives long after the defendants serve well-deserved federal prison sentences. This office works tirelessly to protect the people of South Carolina, especially our most loyal and most vulnerable citizens. I appreciate the work of our federal partners and our partners at DOJ for making this prosecution a success.”

Scott Kohn was also ordered to forfeit $297 million and be placed on supervised release for a period of three years after completing his 10 year prison term.

If you or an elderly loved one suffered financial losses in the purchase of Future Income Payments (FIP), which may have been recommended by your broker/dealer or financial advisor, contact Soreide Law Group and speak to an experienced securities lawyer at no cost regarding the possible recovery of your losses at:  888-760-6552.

Soreide Law Group represents our clients nationwide through FINRA and we operate on a contingency fee basis, no cost to you if no recovery.