Attorney General Mark Herring Wins Lawsuit Against Scott Kohn and Debt Relief Companies Targeting Veterans
The Attorney General of Virginia filed a lawsuit in March 2018 against companies and their owner Scott Kohn for targeting more than 1,000 veterans and retirees with illegal and high interest loans. Attorney General Mark Herring has won this lawsuit by for $50 million in debt relief and civil penalties awarded by Judge Bonnie L Jones.
Future Income Payments, LLF, FIP, LLC and the owner, Scott Kohn, were accused of offering illegals loans to citizens in Virginia that had earned pensions over the years through the armed forces and civil service. Herring, the Attorney General of Virginia, said that he had received lots of complaints about the companies and especially from veterans in Hampton Roads. It is believed that the companies scammed at least 650 people, with interest rates at a high of 183 per cent. This includes a disabled veteran taking out a $5,500 pension loan and being requested to pay more than $40,000.
Herring claimed that Future Income Payments, LLF, FIP, LLC and Kohn had clearly violated the Virginia Consumer Protection Act, taking advantage of people that wanted cash quickly from pension loans. The lawsuit was filed to in order for consumers to receive their money back from this illegal high interest scheme. There were also similar complaints in Minnesota about the same company offering pension sales to retirees in the same position. Herring argued that these loans were totally were deceitful and taking advantage of veterans by disguising them as pension sales.
Indeed, Judge Bonnie L Jones agreed and Attorney General Herring won $50 million in debt relief and civil penalties against Future Income Payments, LLF, FIP, LLC and Kohn. It was stated in the lawsuit that the interest rates were too high and they were illegal. In addition, FIP were ordered to shut down their lending operations across the country.
The order by Judge Bonnie L Jones included $31,740,000.00 in civil penalties and $414,473.72 in restitution to people that were targeted by the illegal scheme. In addition, there was the costs and attorneys’ fees to pay out, which totalled $198,000.00. Of course, the order included injunctive relief, which would prevent FIP and Kohn from breaching the Virginia Consumer Protection Act. There was also to be a declaration that FIP’s agreements with the consumers in Virginia was illegal.
The Attorney General of Virginia, Herring, gave advice to anyone that was thinking about getting a pension loan in the future, suggesting that they should talk to a financial adviser first. This case is an example of how pension sales can be dangerous transactions when it is with the wrong companies.
“This is a really satisfying result because it represents the intersection of two of our biggest consumer protection priorities: combatting predatory lending and protecting our veterans and military families. This ruling is going to wipe out millions in illegal charges for Virginians who fell victim to FIP’s lies and exploitative loans. The civil penalties that were ordered also send a loud and clear message that companies who violate our laws and prey on financially vulnerable Virginians will be held to account, especially when they target our veterans.” —Attorney General Mark Herring