United States of America v. Kohn et al

Filing 2

COPY OF ORDER from USDC-District of South Carolina appointing Beattie B. Ashmore as receiver of the FIP Receivership Entities. Ordered by Judge Bruce Howe Hendricks. (KLF)

6:19-cv-01112-BHH

Date Filed 04/30/19

Entry Number 7

Page 1 of 11

RECEIVED
MAY - 3 2019
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
GREENVILLE DIVISION
UNITED STATES OF AMERICA
V.

SCOTT A. KOHN
FUTURE INCOME PAYMENTS, LLC
Defendants.

IN RE RECEIVER

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C.A. No. 6:19-cv-0111FBHH

This matter is before the Court on the United States of America's Motion to Amend
the Order of Appointment filed April 15, 2019 ("Motion to Amend'). (ECF No. 6.) In the
Motion, the United States asks the Court to add a number of individuals and entities who
are controlled by and/or the alter egos of Scott A. Kohn ("Kohn") and/or Future Income
Payments, LLC ("FIP"). On March 27, 2019, the United States moved the Court pursuant
to Title 18, United States Code, Section 1956(b)(4)(A), and the Court's inherent equitable
powers for the appointment of a Federal Receiver regarding Kohn and FIP (collectively,
"Defendants") (Criminal Action No. 6:19-cr-00239-BHH 1 ). The Court granted the United
States' motion on April 15, 2019, and appointed Beattie B. Ashmore as the Receiver.
After consideration, the Court grants the United States' Motion to Amend. This Order
replaces and supersedes the Order of April 15, 2019. (ECF No. 1.)
It now appears to the Court that there are entities and individuals controlled by
and/or alter egos of the Defendants to include:
Pension, Annuities ·and Settlements, LLC
1

On March 12, 2019, a federal grand jury indicted Kohn and FIP for conspiracy to engage in wire and
mail fraud related to allegations that Kohn and FIP orchestrated and effectuated a Ponzi scheme.

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Entry Number 7

FIP, LLC
Anadolu Trans Gida A.S.
Bally Structured Cash Flows, LLC
Car Champs Finance LLC
Cash Flow Investment Partners East LLC
Cash Flow Investment Partners LLC
Cash Flow Investment Partners Mideast LLC
Computer Supply Corporation
Consolidators Supply Service
DE Computer Supply Corporation
Employment Mobility Fund
EOL Sales and Leasing, Inc.
Georgetown Holdings LLC
Goldyrocks, Inc
Investors Choice Commercial Leasing LLC (ICCL)
Investors Choice Commercial Capital, LLC
Jewels By Kimberly, Inc.
Krishna International Products, Inc.
Leckwith Woods LLC
London Square Collections LLC
London Square Specialty Finance LLC
London Square Specialty Services LLC
Lumpsum Pension Advance Atlantic LLC
Lumpsum Pension Advance Southeast LLC
Lumpsum Pension Atlantic LLC
Lumpsum Pension Southeast LLC
Lumpsum Settlement West LLC
Next Merchant Advance LLC
NWP, Inc
PAS California LLC
PAS Great Lakes LLC
PAS Northeast LLC
PAS Southwest LLC
Pension Advance Carolinas LLC
Pension Advance Midwest LLC
Pension Carolinas LLC
Pension Midwest LLC
Pensions Loans South LLC
Pink Wasabe LLC
QSV Corporation
SK Investments DE, Inc.
SK Judgement Recovery Services
The Judgement Experts

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Date Filed 04/30/19

Entry Number 7

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Trade.com Enterprises, Inc.
Vasnani Co.
Veterans Ride Share LLC
Western Computers, Inc.
Your Leasing Solutions d/b/a VRS Leasing, Inc.
Joseph P. Hipp
Joseph P. Hipp's Agent Alternatives, LLC
Benjamin A. Geber
Melanie-Jo Schulz Miller
MJSM Financial, LLC
In addition, this includes all businesses and/or trusts owned or controlled by Scott
A. Kohn and their subsidiaries, successors and assigns. Collectively, these individuals
and Defendants shall be referred to collectively as the "FIP Receivership Entities."
Whereas, the Government asks that the Receiver be vested with full and exclusive
power, duty and authority to administer and manage the business affairs, funds, assets,
choses in action and any other property of the FIP Receivership Entities, marshal and
safeguard all of the assets of the FIP Receivership Entities, and take whatever actio.ns
are necessary for the protection of the United States and investors.
Whereas, the Court has appointed Beattie B. Ashmore, Esquire, Greenville, ~outh
Carolina who the Court finds is eminently qualified to be appointed as Receiver of all of
the assets, real and personal properties, books and records, and other items of the FIP
Receivership Entities.
Now, Therefore, IT IS ORDERED, ADJUDGED AND DECREED that the appointed
Receiver for the FIP Receivership Entities is hereby authorized, empowered, and directed
to:

1. Take immediate possession of all property, assets and estates owned,
controlled, used, accessed or authorized by or for the benefit of the FIP Receivership
Entities, (including assets and property directly traceable to the FIP Receivership Entities

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that may be in the possession of Kahn's family members, business associates and
. acquaintances) that have and continue to receive, withdraw, hold, and /or disburse money
on behalf of the FIP Receivership Entities or in the possession of the FIP Receivership
Entities of every kind whatsoever and wheresoever located, including, but not limited to,
rights of action, books, papers, data processing records, evidences of debt, bank
accounts, savings accounts, pension/annuity certificates or assignments certificates of
deposit, stocks, bonds, debentures and other securities, mortgages, furniture, fixtures,
office supplies and equipment, and all real property of the FIP Receivership Entities,
wherever situated, and to administer such assets as is required in order to comply with
the directions contained in this Order, and to hold all other assets pending further order
of this Court.
Access to Seized Documents and Property
In the event that any of the foregoing documents or property have been seized by
the Federal Bureau of Investigations ("FBI") such authorities are directed to grant the
Receiver and his agents full and unfettered access to review and copy such documents
and property to permit the Receiver to discharge his duties, subject to the FBl's ability to
review, store, and assure said documents are safeguarded for use in future legal
proceedings. In addition, the FBI is directed to turn over any and all assets seized from
the FIP Receivership Entities directly to the Receiver. Any entity that has possession,
custody, or control of any asset of the FIP Receivership Entities is directed to turn over
such asset to the Receiver.
2. Investigate the manner in which the affairs of the FIP Receivership Entities were
conducted and institute such actions, legal proceedings and/or summary proceedings, for

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the benefit and on behalf of the FIP Receivership Entities, and their respective investors
or other creditors, as the Receiver deems necessary against those individuals,
corporations, agencies, partnerships, associations and/or unincorporated organizations,
that the Receiver may claim to have wrongfully, illegally or otherwise improperly be in the
possession of or misappropriated/transferred monies or other proceeds directly or
indirectly traceable from investors in the Ponzi scheme operated by Defendants, including
their respective officers, directors, employees, affiliates, subsidiaries or any persons
acting in concert or participation with them, or against any transfers of monies or other
proceeds directly or indirectly traceable from investors in FIP; provided such actions may
include, but not be limited to, seeking imposition of constructive trusts, disgorgement of
profits, and such orders from this Court as may be necessary to enforce this Order.
3. Present to this Court a report reflecting the existence and value of the assets
and liabilities of the FIP Receivership. Entities. If the Receiver in executing his duties
believes it is in the best interest of all parties and persons affected that certain assets
seized should be liquidated prior to a final liquidation of assets in order to maximize the
'

value, the Receiver shall take the necessary steps to liquidate such property. The Court
is aware that the Receiver is in the possession of certain assets that may need to be sold
forthwith in order to preserve their value. As to these assets, the Receiver is authorized
to conduct a sale at his discretion without obtaining a specific order from the Court.
4. Appoint one or more special agents, employ legal counsel, actuaries,
accountants, clerks, consultants and assistants as he deems necessary and to fix and
pay their reasonable compensation and reasonable expenses thereof and all reasonable
expenses of taking possession of the FIP Receivership Entities' assets and businesses,

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and exercising the power granted by this Order, subject to approval by this Court at the
time the Receiver accounts to the Court for such expenditures and compensation.
5. Engage persons in his discretion to assist him in carrying out his duties and
responsibilities as Receiver, including, but not limited to, the United States Marshal's
Service or a private security firm.
6. Defend, compromise or settle legal actions, including the instant proceeding,
wherein the Defendants or the Receiver are a party, commenced either prior to or
subsequent to this Order, with authorization of this Court; except, however, in actions
where any Defendant is a nominal party, as in certain foreclosure actions where the action
does not affect the assets of the Defendants, the Receiver may file appropriate pleadings
in his discretion. The Receiver may waive any attorney-client or other privilege held by
Defendants.
7. _Assume control of,. and be nam~d as authorized signatory for, all accounts at
any bank, brokerage firm or financial institution that has possession, custody or control of
any assets or funds, wherever situated, of-or for the benefit of-the FIP Receivership
Entities and, upon order of this Court, of any of their subsidiaries or affiliates, provided
that the Receiver deems it necessary.
8. In the event that the Receiver discovers that funds of persons who have invested
in the FIP Receivership Entities, have been transferred to other persons or entities, the
Receiver shall recover these funds or apply to this Court for an Order giving the Receiver
possession of such funds and, if the Receiver deems it advisable, extending this
receivership over any person or entity holding such investor funds.
9. Make or authorize such payments and disbursements from the funds and assets

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taken into control, or thereafter received by the Receiver, that which are reasonable in
discharging his duties as Receiver.
10. Have access to and review all mail except for mail from the Defendants'
attorney to Defendant, as more fully set forth in paragraph 24 of this Order.
11. Upon conviction or guilty plea, if such a conviction or guilty plea comes to bear,
do all things necessary, including, but not limited to fashioning and distributing a proof of
claim form in order to obtain, collect, analyze, verify and present to the Court information
related to the financial loss of victims.
12. Upon entry of an Order of Restitution, if such an order is entered, do all things
necessary to effectuate a distribution, including, but not limited to fashioning and
submitting a Plan for Claims Administration and Distribution of Proceeds to be approved
by the Court; locating, seizing, managing and liquidating, with Court approval, assets held
or obtained by the Receiver; and distributing, at the Court's discretion, the corpus of the
Receiver Estate to those persons who have met the requirement for and are entitled to
restitution.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that, in connection with
the appointment of the Receiver provided for above:
13. As set forth in detail below, the following proceedings, excluding the instant
proceeding and all police or regulatory actions, are stayed until further Order of this Court:
All civil legal proceedings of any nature, including, but not limited to,
bankruptcy proceedings, arbitration proceedings, foreclosure actions,
default proceedings, or other actions of any nature involving: (1) the
Receiver, in his capacity as Receiver; (b) any Receivership Property,
wherever located; (c) any of the Receivership Entities, including
subsidiaries and partnerships; or, (d) any of the Receivership Entities' part
or present officers, directors, managers, agents, or general or limited
partners sued for, or in connection with, any action taken by them while

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acting in such capacity of any nature, whether as plaintiff, defendant, thirdparty plaintiff, third-party defendant, or otherwise (such proceedings are
hereinafter referred to as "Ancillary Proceedings").
The Parties to any and all Ancillary Proceedings are enjoined from commencing or
continuing any such legal proceeding, or from taking any action, in connection with any
such proceedings, including, but not limited to, the issuance or employment of process.
All Ancillary Proceedings are stayed in their entirety, and all Courts having any
jurisdiction thereof are enjoined from taking or permitting any action until further Order of
this Court. Further, as to a cause of action accrued or accruing in favor of one or more of
the Receivership Entities against a third person or party, any applicable statute of
limitations is tolled during the period in which the injunction against commencement of
legal proceedings in in effect as to that cause of action.

14. The FIP Receivership Entities and all of their respective directors, officers,
agents, employees, attorneys, attorneys-in-fact, shareholders, sales representatives and
other persons who are in custody, possession, or control· of any assets, books, r~cords,
or other property of the FIP Receivership Entities shall deliver forthwith upon demand
such property, monies, books and records to the Receiver, and shall forthwith grant to the
Receiver authorization to be a signatory as to all accounts at banks, brokerage firms or
financial institutions that have possession, custody or control of any assets or funds in the
name of or for the benefit of the FIP Receivership Entities.

15. All banks, brokerage firms, financial institutions, or other business entities that
have or may have -- per information provided by the Receiver -- possession, custody or
control of any assets, funds or accounts in the name of, or for the benefit of the FIP
Receivership Entities or in the name of or for the benefit of individuals known to be

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working in concert with the FIP Receivership Entities (including those acting in the
capacity of investment advisors and insurance agents) shall cooperate expeditiously in
providing necessary information and in the granting of control and authorization as a
necessary signatory as to said assets and accounts to the Receiver, including but not
limited to, placing a freeze on accounts at the Receiver's direction. Any required
disclosure and notification of the Receiver's request for information and/o'r control of said
assets and accounts shall occur in a manner so as not to impede th.e duties of the
Receiver.

16. Unless and as authorized by the Receiver, the FIP Receivership Entities, and
their respective principals or anyone purporting to act on their behalf shall take no action
on behalf of or for the benefit of the FIP Receivership Entities.

17. The FIP Receivership Entities, and their respective principals, officers, agents,
employees, attorneys-in-fact, and sales representatives shall cooperate fully with the
Receiver, including, if requested, appearing for deposition testimony and producing
documents, upon two business days' notice (which may be sent electronically or by
facsimile), and shall take no action, directly or indirectly, to hinder, obstruct, or otherwise
interfere with the Receiver in the conduct of his duties or to interfere in any manner,
directly or indirectly, with the custody, possession, management, or control by the
Receiver of the funds, assets, premises, or choses in action described above.

18. The Receiver, or any counsel who the Receiver may select, is entitled to
reasonable compensation from the assets now in the possession or control of, or which
may be received by the FIP Receivership Entities; said amount or amounts of
compensation shall be commensurate with the duties performed, subject to approval of

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the Court.
19. During the period of this Receivership, all persons, including creditors, banks,
investors, or others, with actual notice of this Order, are enjoined from filing a petition for
relief under the United States Bankruptcy Code without prior permission from this Court,
or from in any way disturbing the assets or proceeds of the receivership or from
prosecuting any actions or proceedings that interfere with the discharge of the Receiver's
obligations.
20. The Receiver is fully authorized to proceed with any filing he may deem
appropriate under the Bankruptcy Code as to Defendants.
21. Title to all property, contracts, rights of action, and books and records of the
FIP Receivership Entities, and their respective principals, wherever located, is vested by
operation of law in the Receiver.
22. Upon request by the Receiver, any company. providing telephonic services to
the_FIP Receivership Entities, shall provide a reference of calls from all numbers presently
assigned to the FIP Receivership Entities, to any such number designated by the
Receiver or perform any other changes necessary to the conduct of the receivership.
23. Any entity furnishing water, electric, telephone, sewage, garbage or trash
removal services to the FIP Receivership Entities shall maintain such service and transfer
any such accounts to the Receiver unless otherwise instructed by the Receiver without
the need to post a bond or security deposit.
24. The United States Postal Service is directed to provide any information
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requested by the Receiver regarding any Defendant, and handle future deliveries of
Defendants' mail as directed by the Receiver. All personal mail or mail to or from the

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Defendants' attorney will be delivered to the Defendants' attorney by the Receiver.
25. All Clerks of Court for the District Courts of the United States are directed to
coordinate with the Receiver to facilitate the filing of notices required by 28 U.S.C. § 754.
26. No bank, savings and loan association, financial institution, or any other person
or entity, shall exercise any form of set-off, alleged set-off, lien, or any form of self-help
whatsoever, or refuse to transfer any funds or assets to the Receivers control without the
permission of this Court.
27. No bond shall be required in connection with the appointment of the Receiver.
Except for an act of gross negligence, the Receiver shall not be liable for any loss or
damage incurred by the FIP Receivership Entities, or the Receiver's officers, agents,
employees, independent representatives or any other person, by reason of any act or
omission by the Receiver in connection with the discharge of his duties and
responsibilities hereunder. _

28. Service of this Order shall be sufficient if made upon the FIP Receivership
Entities or their respective principals electronically, by facsimile, or by overnight courier.
29. The Receiver is ordered to periodically file a Report on his activities with the
Court.
IT IS SO ORDERED.
ls/Bruce Howe Hendricks
United States District Judge

Greenville, South Carolina
April 30, 2019

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