Advisor Kari Bracy Accused of Selling Future Income Payments Investment Fraud

shutterstock_155271245-300x300According to BrokerCheck records financial advisor Kari Bracy (Bracy), currently employed by NYLife Securities LLC (NYLife Securities) has been subject to one customer complaint during his career.  According to records kept by The Financial Industry Regulatory Authority (FINRA), the complaint against Bracy concerns allegations of unsuitable investments in Future Income Payments, Inc. (FIP).  Bracy has several disclosed outside business activities including Amani Properties, LLC and his d/ba/a name Mahoney Financial Organization, LLC and Wahby Financial Group LLC.

In July 2018 a customer complained that Bracy recommended an investment in Future Income Payments, Inc. a private securities transaction, was misrepresented as a conservative and safe investment with a 7.5% annual return for ten years.  The claim alleged $142,697.27 in damages and settled for $80,000.

The law offices of Gana Weinstein LLP have been investigating investor recovery options due to the alleged pay advance fraud scheme orchestrated by Future Income Payments, LLC (Future Income Payments) also known as Pensions, Annuities, and Settlements, LLC, and its owner Scott Kohn (Kohn). Future Income Payment is an unregistered and illegal security offering.  Numerous state and local regulators and agencies also have concluded that FIP product violates a host of laws including securities, loan laws, usury laws, elder abuse, and consumer protection laws.

At the heart of the alleged scheme is the misrepresentation that Future Income Payments engages in agreements that are sales of pensions and not loans. However, regulators have claimed that the company misstates the effect of the contract and that in fact pensioners are entering into a consumer loan and not a sale.  The purpose of the misrepresentations are to try to exempt Future Income Payments’s loans from consumer lending laws and regulations and to collect interest on loans at illegal rates.

Regulators have claimed that FIP made the following false representations to investors in an attempt to evade various consumer protection laws:

  • Labels itself a “Purchase and Sale Agreement,” despite the fact that the consumer was receiving a sum of money that he was obligated to repay, i.e., receiving a loan;
  • Refers to a “Purchase Price” paid to the consumer, although that phrase actually means the principal amount of the consumer’s loan;
  • Claims that FIP is paying the Purchase Price to receive certain portions of the consumer’s future pension payments (the “Payment Amounts”), but those payments actually constitute a repayment schedule for a loan;
  • Refers to a “Discount” of the Purchase Price, which is actually interest on the loan-approximately 137% APR for five years in the case of the attached loan;
  • Requires the payment of a “Set-up Fee,” which is an origination fee common on many consumer loans; and

Bracy entered the securities industry in 2009.  Since July 2009 Bracy has been associated with NYLife out of the firm’s Jacksonville Beach, Florida office location.

Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. The investment lawyers at Gana Weinstein LLP represent investors who have suffered investment losses due to allegations of wrongdoing. The majority of these claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.