A series of lawsuits were filed nationwide Thursday in a bid to help swindled investors — mostly retirees — retrieve the money they invested in a $100 million sham pension scheme concocted by a former felon who’s on the run.
The law firm Peiffer Wolf Carr & Kane initiated a coordinated wave of five lawsuits targeting the purported legitimate financial professionals who made the Future Income Payments LLC, or FIP, scheme work.
“We’re seeking recovery for these swindled investors from insurance agents, investment advisors and brokers in the Los Angeles area, the Houston area, Chicago, northern Florida and Philadelphia and New Jersey,” said Joseph Peiffer, attorney and managing shareholder at PWCK, on a Thursday media call. “Coast to coast, all the way around this country, because that’s where this stuff was sold.”
The investors were encouraged to buy into “structured cash flows” through FIP.
Attempts to reach FIP for comment were unsuccessful.
Investors paid — in most cases every cent they had — to buy a monthly income stream for a set term (usually five or 10 years) under a pension advance arrangement targeting individuals with fixed pensions (often retired police officers, teachers and veterans), PWCK explained.
FIP is a small Nevada company run by a California ex-felon, Scott Kohn, who Peiffer said on the call is “now nowhere to be found.”
As one of the complaint states, Kohn “pleaded guilty in 2006 to three federal felony offenses related to trafficking in counterfeit goods, and he was sentenced to 15 months in federal prison.”
As Peiffer explained, several states have ruled the FIP pension purchases to be illegal loans at up to 200% interest. “Because of mounting regulatory pressure and multiple cease-and-desist orders, FIP stopped collecting payments from pensioners or making payments to investors on or about April 2018,” he said.
As part of the scheme, most investors also were encouraged to purchase life insurance and indexed universal life insurance policies.
FIP “purchased” the future income from the pensioners on an upfront, lump-sum and heavily discounted basis. The insurance agents, brokers, financial planners and investment advisor firms that promoted the scheme to investors collected a healthy commission.
“The massive scale of this investment swindle could not have happened without an eager and complicit network of brokers, investment advisors, financial planners, insurance agents and other middlemen like wholesalers, distributors and life insurance companies,” Peiffer said.