Feds nab fugitive in $1B Ponzi scheme targeting military vets

| September 25, 2019

ponzi scheme

ChipNASA sends us a link on an individual criminal targeting mostly military Vets with fast money, but with usurious interest payments to float his Ponzi scheme. The Vets were attractive victims because of their steady retirement and/or disability incomes.

Old school practices of tar and feathering and riding out of town on a rail seem appropriate here, along with a long term sentence in a Federal lockup.

From the article:

By Stephanie Pagones

U.S. marshals have nabbed a California man on the run since his March indictment in a $1 billion Ponzi scheme that largely targeted veterans, according to reports.

Scott Kohn, 65, was arrested Saturday on a San Diego beach, according to the Greenville News.

Kohn, the owner of Future Income Payments LLC, was charged with conspiracy to engage in mail and wire fraud. He has been accused of recruiting borrowers “who were desperate for money” and charging them interest rates that might top 240 percent for cash advances that were repaid through their pensions, according to the FBI and court filings.

That money, in turn, was funneled to investors who had been promised “structured cash flows” and a return of 6.5 percent to 8 percent through Future Income Payments, investigators said. The firm also used money from new investors to cover payouts to earlier clients, the government said.

Thanks ChipNASA. The rest of the article may be viewed at Fox Business News

Category: Crime, Exploitation, Guest Link, Legal

Comments (14)

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  1. Helpful Medal says:

    “He has been accused of recruiting borrowers “who were desperate for money” and charging them interest rates that might top 240 percent for cash advances that were repaid through their pensions, according to the FBI and court filings.”

    I fail to see the problem here. Did they get their money? Was the interest rate stated in the document?

    • AW1Ed says:

      Usury- the practice of making unethical or immoral monetary loans that unfairly enrich the lender, beyond that set by state law.

      Wire / Mail Fraud- any fraudulent scheme to intentionally deprive another of property or honest services via mail or wire communication. It has been a federal crime in the United States since 1872.

      Look up Bernie Madoff.

      • Perry Gaskill says:

        Ed, a more clear explanation for the lending scheme is contained in the story Fox News linked to in the Greenville News in South Carolina. Where Scott Kohn apparently screwed up was in violation of laws in multiple states which make it illegal, without proper disclosure, to make high-interest loans using fixed-income pensions as collateral. What made it a federal beef, the mail and wire fraud, is that the transactions crossed state lines. It wasn’t actually about high-interest usury violations.

        Kohn’s company, Future Income Payments LLC, had apparently targeted veterans on both the front and back ends. Those who were loaned the money, at least it seems to me, weren’t the bigger victims. Kohn evidently left 2600 investors holding the bag to the tune of $451 million.

        What also makes this story interesting is that it takes place in what appears to be a general crackdown on private lenders. It’s been estimated that there are twice as many payday advance lenders now in operation as there are McDonald’s restaurants. A related development is that the state of California this month passed a law making it illegal to loan money at a more than 36 percent interest. Those involved in advance payday loans say the new rule will effectively put them out of business because of their operating costs.

        • A Proud Infidel®™ says:

          I feel about as sorry for them as I do the ones who offer Car Title pawn services, they also cheat the hell out of low income people right and left!

    • Poetrooper says:

      Hopeless Muddle says, “I fail to see the problem here.”

      No shit, Sherlock…

      • SFC D says:

        Helpless has his head inserted so deeply into his ass that he can’t see a damn thing without a glass bellybutton.

  2. Comm Center Rat says:

    “You’ve got to tell your money what to do or it will leave.” ~ Dave Ramsey

  3. Ex-PH2 says:

    …not enough cactus patches in the world.

  4. 5th/77th FA says:

    Is there enough tar and feathers and a long enough rail to include a coupla aggravating trolls to that escort out of town to a nice Super Max lock up? Asking for myself.

  5. A Proud Infidel®™️ says:

    Here’s hoping that he has many a date in the showers with Bubba, Thor, Julio and “Tiny Tyrone” before they pimp him out to the rest of their cell block.

  6. Mason says:

    240%? This guy should have stuck to the usually military money scams of essential oils and 24% APR auto loans.

  7. 2banana says:

    Per week? Month? Year?

    “and a return of 6.5 percent to 8 percent”

    Plenty of solid stocks have a dividend in the general area.

    • David says:

      Was thinking the same…if you don’t have the smarts to invest at those rates of return, find an adviser who can.