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The Consumer Financial Protection Bureau (CFPB) has filed a complaint against Future Income Payments, LLC (FIP), Scott Kohn, and related entities, alleging that the defendants violated the Consumer Financial Protection Act of 2010, 12 U.S.C. § 5536(a)(1)(B), according to a press release. The complaint alleges that the defendants represented that their pension-advance products were not loans, were not subject to interest rates, and were comparable in cost to, or cheaper than, credit card debt when, in actuality, the pension-advance products were loans, and were subject to interest rates that were substantially higher than credit card interest rates. Additional related entities include FIP, LLC; BuySellAnnuity Inc.; Cash Flow Investment Partners LLC; Pension Advance LLC; Cash Flow Investment Partners East LLC; Cash Flow Investment Partners MidEast LLC; Lumpsum Pension Advance Atlantic LLC; Lumpsum Pension Advance Southeast LLC; Lumpsum Settlement West LLC; PAS California, LLC; PAS Great Lakes, LLC; PAS Northeast LLC; PAS Southwest LLC; Pension Advance Carolinas LLC; Pension Advance Midwest LLC; and Pension Loans South LLC. The lawsuit, filed in federal district court in the Central District of California, also alleges that the defendants violated the Truth in Lending Act (TILA), 15 U.S.C. § 1638(a)-(b), by failing to disclose a measure of the cost of credit, expressed as a yearly rate.

U.S. securities law can be used to prosecute fraud cases over cryptocurrency offerings, a New York federal judge ruled on Tuesday in what appeared to be the first court decision to address the issue, Reuters reported. The ruling from U.S. District Judge Raymond Dearie in Brooklyn allows federal prosecutors to pursue their case against Maksim Zaslavskiy. The Brooklyn resident was arrested in November on charges that he defrauded investors in two cryptocurrencies, violating the federal Securities Exchange Act. Prosecutors have said that Zaslavskiy last year raised at least $300,000 from investors in a cryptocurrency called REcoin, which he claimed was backed by real estate, and another cryptocurrency called Diamond, which he said was backed by diamonds. In fact, prosecutors said, no real estate or diamonds backed the virtual currencies.

The Securities and Exchange Commission charged Texas-based Greenview Investment Partners L.P. and its founder Michael E. Cone yesterday with allegedly defrauding investors by promising 24 percent annual returns from cannabis-related investments, MarketWatch.com reported. The U.S. Attorney in California has also criminally charged Cone and seized approximately $1.4 million in cash and assets. The fund and Cone raised more than $3.3 million by allegedly employing boiler room sales staff to cold call investors to promise unattainable returns based on misleading marketing materials. According to the SEC complaint, Cone also concealed his prior criminal convictions by using an alias, lied about having a former agent from the U.S. Drug Enforcement Administration on staff, and falsely claimed to have a long record of profitably investing millions in cannabis-related businesses. Cone allegedly spent investors' money on designer clothes and luxury cars, and Ponzi-like payoffs of earlier investors. Cone settled the SEC's charges by agreeing to an officer-and-director bar and a permanent injunction. 

Steven Davis, a former chairman of Dewey & LeBoeuf, has agreed to pay a $130,000 civil penalty in a settlement with the U.S. Securities and Exchange Commission, according to newly filed court papers, the largest fine so far to come out of the SEC’s case against five leaders of the now-defunct firm, The American Lawyer reported. The SEC filed court papers Aug. 31 laying out the details of Davis’ settlement, as well as the settlements with ex-finance director Francis Canellas, who has agreed to pay $43,178 in disgorgement and interest; and former Dewey controller Thomas Mullikin, who has agreed to pay $8,635.78 in disgorgement and interest costs. If the settlements are approved by the court, the SEC will have wrung out of Dewey leaders about $216,815, including its settlement with former Dewey executive director Stephen DiCarmine. That deal, including a $35,000 civil penalty, was revealed earlier this year.

Theranos Inc., the blood-testing company accused of perpetrating Silicon Valley’s biggest fraud, will soon cease to exist, the Wall Street Journal reported. In the wake of a high-profile scandal, the company will formally dissolve, according to an email to shareholders. Theranos will seek to pay unsecured creditors its remaining cash in coming months, the email said. The move comes after federal prosecutors filed criminal charges against Theranos founder Elizabeth Holmes and the blood-testing company’s former No. 2 executive, alleging that they defrauded investors out of hundreds of millions of dollars and defrauded doctors and patients. The executives have denied the charges and face a coming criminal trial. The dissolution process was precipitated by the fact that Theranos breached a covenant governing a $65 million loan it received from Fortress Investment Group last year. Under the loan terms, Fortress was entitled to foreclose upon the company’s assets if its cash fell beneath a certain threshold.

A businessman who led an adult-magazine empire that included titles like Playgirl and High Society has been accused by the Securities and Exchange Commission of defrauding investors through the sale of unregistered securities, the Wall Street Journal reported. Carl Ruderman and 1 Global Capital LLC, the Florida small-business lender he led as chairman and chief executive, are accused of fraudulently raising more than $287 million from thousands of investors. Roughly 3,400 investors, many of whom risked their retirement savings, over more than four years invested in 1 Global’s securities, according to a complaint filed in Florida federal court on Aug. 23 and unsealed this week. The securities were sold through a network of agents that included people barred from the industry, the complaint said.