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CA Advisor Gets 10 Years in Prison for $300M Ponzi Scheme Targeting Veterans

Scott Kohn, 68, of Newport, California, has been sentenced to 10 years in prison for his role as the ringleader of a nationwide, $300 million Ponzi scheme, according to an announcement from the U.S. Department of Justice.

jail cage 1161869 640 smallKohn ran a corporation called 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 a vehicle for the nationwide scheme.

Kohn and his co-conspirators solicited pensioners experiencing financial distress, most of whom were military veterans, by offering an upfront lump-sum payment in exchange for an assignment of the rights to their monthly pensions and disability payments. Even though the assignment transactions were characterized as “sales,” they were, in fact, usurious loans with annual interest rates of as much as 240%.

During the seven years the scheme operated, Kohn drew upon FIP funds to live a lavish lifestyle. When the Ponzi scheme ultimately collapsed, Kohn and his co-conspirators had caused more than $310 million in losses to more than 2,500 retirees and had placed more than 13,000 veterans into exploitative loans.

Read the full announcement from the Justice Department.

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