A Newport Beach man was charged in Greenville, South Carolina for a Ponzi scheme that defrauded pension holders “desperate for money,” many of whom were veterans, according to the U.S. Attorney’s Office.

When the company involved stopped doing business in early 2018, authorities said, investors were owed about $300 million.

Scott Kohn, 64, was arraigned last week, Nov. 13, and charged with conspiracy to engage in mail and wire fraud. Also charged in the indictment was Kohn’s company, Future Income Payments, an entity organized under Nevada laws.

Kohn was arrested in San Diego on Sept. 21, court records show.

According to the indictment, Future Income Payments operated the scheme in which pension holders, many of them veterans of the United States Armed Forces, were recruited.

“The pensioners made monthly payments to FIP in exchange for a lump-sum payment or loan,” the indictment states. “The adjusted annual percentage rate on these transactions often exceeded 100%.”

There were approximately 2,600 victims of the scheme, the U.S. Attorney’s Office said.

The company, which began operating as early as April 2011, solicited investors to buy “structured cash flows” that were the pensioners’ monthly payments. FIP promised the investors they’d see returns of 6.5% to 8%.

If found guilty, Kohn could face 20 years in federal prison for the conspiracy charge and a fine of $250,000. Three other of Kohn’s associates also faces charges.

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“It took active steps to conceal from the investors the (high-interest-rate) nature of its transactions with the pension holders,” according to the U.S. Attorney’s Office statement.

The company diverted investor money into the businesses to fund payments to earlier investments to keep it operating.