Did you lose money investing in Future Income Payments (FIP)?
Galvin Legal, PLLC is launching an investigation on behalf of investors who suffered losses investing in Future Income Payments (FIP) at the recommendation of their financial advisor. If you suffered losses investing in the investment, then Galvin Legal, PLLC may be able to help you recover your losses in a Financial Industry Regulatory Authority (“FINRA“) arbitration claim against the brokerage firm that recommended the investment.
Federal prosecutors allege that Future Income Payments (FIP), a company owned and operated by 64-year-old Scott Kohn of Newport Beach, California, was a Ponzi scheme that recruited “pension holders who were desperate for money,” including veterans. The pensioners made monthly payments to Future Income Payments (FIP) in exchange for a lump sum payment or loan. Prosecutors said the adjusted annual percentage rate on the transactions often exceeded 100%.
Scott Kohn was indicted by a federal grand jury in South Carolina for his alleged role in the Future Income Payments (FIP) Ponzi scheme. Scott Kohn had been on the run for six months following an indictment by a federal grand jury in Greenville, SC. Prosecutors allege that Kohn defrauded 2,600 investors out of approximately $300 million. Scott Kohn plead not guilty on November 13, 2019 to two counts of attempting and conspiring to commit mail fraud. Federal authorities say Kohn is a native of Michigan, and allegedly spent his money on artwork, high-end automobiles, and real estate that included a $4.8 million home in California and a $1.7 million Las Vegas estate.
U.S. Attorney Sherri Lydon said that “[t]he scheme alleged in this indictment took advantage of pensioners facing difficult financial situations–including veterans of the U.S. armed forces–and preyed upon innocent investors to the tune of roughly $300 million.” Currently, Scott Kohn is in federal custody. If Scott Kohn is convicted, he could face up to 20 years in federal prison and a fine of up to $250,000.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Due Diligence Requirement
FINRA requires brokerage firms to conduct due diligence on investments and to conduct a suitability analysis when recommending securities to a customer that takes into account the customer’s knowledge and experience. FINRA Rule 2111(a) states that “a member or an associated person must have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the member or associated person to ascertain the customer’s investment profile. A customer’s investment profile includes, but is not limited to, the customer’s age, other investments, financial situation and needs, tax status, investment objectives, investment experience, investment time horizon, liquidity needs, risk tolerance, and any other information the customer may disclose to the member or associated person in connection with such recommendation.”
Rule 2111 is composed of three main obligations: reasonable-basis suitability, customer-specific suitability, and quantitative suitability. Brokerage firms that fail to conduct adequate due diligence on investments they recommend, such as Future Income Payments (FIP), or that make unsuitable recommendations can be held responsible for the customer’s losses in a FINRA arbitration claim.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Request a Free Consultation with a Securities Attorney
If you suffered losses investing in Future Income Payments (FIP) and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
This information is all publicly available and is being provided to you by Galvin Legal, PLLC.
Galvin Legal, PLLC is a national securities arbitration, securities mediation, securities litigation, securities fraud, securities regulation and compliance, and investor protection law practice. For more information on Galvin Legal, PLLC and its representation of investors, please visit www.galvinlegal.com or call 1-800-405-5117.
