The Pittsburgh Post-Gazette today reported that a recently-filed lawsuit alleges that financial advisers and others should have known that investments in a pension-factoring company were questionable.
In the story (Investors, Regulators Can’t Find Architect Of Massive Pension Scheme, available here), Len Boselovic reports that “Scott Kohn, an ex-felon who orchestrated a nationwide scheme that victimized retirees as well as investors seeking safe monthly income, is nowhere to be found.”
Boselovic said that officials “from Pennsylvania’s Department of Banking and Securities trying to enforce a May agreement with Mr. Kohn’s Future Income Payments” but cannot locate Kohn, and that regulators in a number of states had accused Future Income Payments (FIP) “of charging exorbitant interest rates on pension advance loans to more than 1,700 retirees.”
Boselovic says that New Orleans attorney Joseph Peiffer believes investors lost more than $100 million after purchasing FIP products and that, even if found, Kohn “won’t have enough money to make investors whole.”
“So Mr. Peiffer is suing financial advisers, life insurance agents and other intermediaries who sold FIP products,” writes Boselovic, who adds that Peiffer’s firm filed an Ohio lawsuit and and plans to additional lawsuits against those who sold FIP products.
An earlier Secondary Insurance Market Blog post about FIP (Wall Street Journal: Secondary Insurance Market Company Disappears, Leaving Investors Stranded) is available here.