Scott Kohn

What the public record shows

Scott Kohn, 68, of Newport, California, ran Future Income Payments LLC (FIP) (formerly “Pensions, Annuities, and Settlements LLC”). He pleaded guilty to fraud conspiracy and was sentenced to 10 years in prison, with $297 million ordered forfeited. This is a criminal conviction — not an allegation.

The scheme

According to the Department of Justice, from April 2011 to April 2018, Kohn and his co-conspirators ran a nationwide Ponzi scheme that targeted people in financial distress — the majority of them military veterans — offering an upfront lump-sum cash payment in exchange for the rights to their monthly pension and disability payments.

• The deals were labeled as “sales,” but were in substance loans carrying annual interest rates as high as 240% — far beyond what’s legal.
• The scheme ultimately caused $310 million in losses to 2,500 retirees and pulled 13,000 veterans into these disguised, predatory contracts.
• Investors who bought into FIP’s payment streams (expecting steady returns funded by the veterans’ pension payments) were also victims once the underlying scheme collapsed.

Why we rate this 1 / 10 — Avoid

A guilty plea and a 10-year sentence for a scheme that specifically targeted veterans in financial distress — among the most vulnerable population any fraud can target — while disguising an illegal, extreme-interest loan as a simple pension “sale.”

Red flags this case teaches

• “Sell your pension for cash now” offers are, in almost every state, actually loans — and the true interest rate is often hidden in the fine print.
• Veterans and retirees are specifically targeted by these schemes; extra caution and a second opinion (from the VA, a nonprofit veteran-services org, or an attorney) is warranted before signing anything involving pension rights.
• If you’re offered a chance to invest in pension-payment streams promising steady yields, verify the underlying pensioners and payments independently before buying in.

Bottom line

Convicted and sentenced to 10 years. A “pension sale” is legally a loan — check the real interest rate and talk to the VA or a nonprofit veterans’ service organization before signing away your pension rights.

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