Future Income Payments (FIP) stopped paying investors in April 2018. We estimate that FIP and/or its affiliated raised approximately $600 million dollars between 2011-2018. There are approximately 4000 investors and 27,000 pension sellers. To date, the primary legal action is the complaint filed by the Bureau of Consumer Financial Protection against FIP for Violations of the Consumer Financial Protection Act of 2010 and The Truth In Lending Act filed in the United States District Court For the Central District of California, Southern Division (Case No. 8:18-cv-01654). Various State Attorneys General have also filed cases and most recently the State of Virginia obtained a $31 million default judgment.
In order to protect investors, we are planning to commence an action that provides a legal forum to collect money for investors and resolve claims on an expedited basis. After listening and meeting with many agents and conducting some prior research, The Sarachek Law Firm is planning on doing the following:
Directly interact with investors and present them with an engagement letter to represent them in getting repaid. While the initial introduction would be through agents who introduced these clients to the investment, the investor would be our client.
Once we have the requisite number of clients, we would a bankruptcy petition under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Central District of California. FIP will have 20 days to respond to the petition. We will also be seeking appointment of a Trustee.
The advantage of commencing a bankruptcy case is that it is an expedited forum for resolving creditor issues as opposed to a State or Federal civil proceeding. Bankruptcy law provides transparency to all parties.
There are other advantages of a bankruptcy case as well, expanded recovery powers of a Trustee, expedited timetables for resolution of disputes, and lastly oversight of legal fees by the Bankruptcy Judge.
To the extent you want to check out our references, here's some quick facts about me:
Credentials. Joseph (Joe) Sarachek is an internationally reknown Bankruptcy Lawyer and Restructuring Advisor since 1987 (30 years). I have been involved in hundreds of cases, large and small, primarily on behalf of creditors and investors but in every role in the restructuring area: debtor's counsel, board member, Trustee, Creditors' Committee counsel, and investor. I currently teach a course in bankruptcy investing at NYU Stern for MBA students.
Recent cases are: Woodbridge Group where I represent 270 investors with $40 MM in aggregate debt. I have been a diligent advocate for noteholders in the face of significant opposition; 1 Global Capital where I represent both agents & lenders with approximately $20 MM loaned; Sears Holdings Corp. where I represent several vendors; and Toys 'R Us where I represent vendors as well.
What separates me from other attorneys is that I am an active investor in life settlements ($3 billion); bankruptcy trade claims (www.triaxcap.com); and litigation finance. This provides me with a unique understanding of alternative investments. Accordingly, I am able to provide our clients with solutions that others are not.
References: I can provide numerous personal references to clients upon request.
We have numerous agents who have recommended us to their clients and paid a $1,000 retainer fee on behalf of their clients.
