$100M Pension Scheme Nets Thousands Of Victims, Lawyer Says

Published by Financial Advisor Magazine
August 10, 2018 530 a.m. ET
By Karen Demasters

Benjamin and Milea Sarap refinanced their home in Sunbury, Ohio, to invest more than $130,000 in a pension program that was supposed to give them monthly payments during their retirement, according to a lawsuit filed in Ohio.

This suit is one of many filed in 25 states by victims trying to recoup money they invested in an opaque and risky pension loan program, the suit says. The investments collected by Scott Kohn, a 64-year-old felon operating out of a Nevada strip mall, allegedly cost thousands of victims more than $100 million.

The Saraps ended up in their predicament after developing a relationship with the pastor of their church, Ronald Joseph, a financial advisor. He advised them to invest their money in Future Income Payments, the company run by Kohn, and they took his advice. Joseph is named as the defendant in the Sarap suit, which was filed July 23 in the Court of Common Pleas in Franklin County Ohio.

Joseph could not be reached for comment on the suit and the whereabouts of Kohn, who has served time in federal prison, are unknown.

The Saraps’ suit says Joseph should have known Future Income Payments was in deep trouble in many states, had already been barred from doing business in many places and any investments in the structured cash flows that were being promoted were illiquid and risky, said Joseph Peiffer, the Saraps’ lawyer.

Peiffer’s firm, Peiffer Wolf Carr & Kane in New Orleans, Cleveland and elsewhere in the United States, is representing 125 clients like the Saraps in various jurisdictions who have lost money because of the Future Income Payments scheme, Peiffer said. Peiffer’s firm is only one of several representing thousands of complainants across the country.

Peiffer said the Saraps have a chance of getting some of their money back.

Structured cash flows like the Saraps were investing in involve investors buying other people’s pension benefits. The holder of the pension gets a lump sum payment. In this case, Future Income Payments bought the rights to workers’ pensions and sold those benefits to investor, often for exorbitant interest rates, the lawsuit says.

“State officials in multiple states have issued cease and desist orders, accusing FIP of issuing loans without a license and disguising them in sales agreements,” Peiffer said.

Future Income Payments “bought pensions under questionable terms and sold those pension streams to investors without disclosing the risks,” the Saraps’ law suit says.

What to Do if You Think You Were a Victim of Investment Fraud or Broker Misconduct

If you believe you were a victim of investment fraud or broker misconduct, it is imperative to take action. Peiffer Wolf Carr & Kane has represented thousands of victims, and we remain committed to fighting on behalf of investors.

Contact Peiffer Wolf Carr & Kane today by filling out a Contact Form on our website or by calling 585-310-5410 to schedule a FREE Case Evaluation.

About Peiffer Wolf  Carr & Kane, APLC

Peiffer Wolf Carr & Kane is a nationwide litigation law firm that represents individuals and entities that have been the victims of negligence, fraud or the misconduct of powerful interests.  We are smart, experienced, and dedicated professionals who work tirelessly for our clients and take pride in the pursuit of justice on their behalf.  Too often the powerful interests in our society run over the rights of ordinary people. We do our best to restore that balance.

prwlegal201 (15 Posts)

In our legal system, every person is innocent until and unless found guilty by a court of law or a tribunal. Whenever we reference “allegations” or charges that are “alleged,” such allegations or charges have not been proven, and are merely accusations, not findings of fault, as of the date of the blog. We do not have, nor do we undertake, a duty to continue to monitor or follow cases about which we report, and/or to publish subsequent blogs regarding various developments that may occur in such cases. Readers are encouraged to conduct their own research regarding any such cases and any developments that may or may not have occurred in such cases.