Update, there have been some major developments with FIP, or Future Income Payment, please watch the video below for more information:


Structured Cash Flow investments are just the latest in the line of products that began with viaticals, which became popular during the 1980’s AIDS epidemic.  Then there were the senior life settlements with middlemen/promoters solicited seniors to sell their life insurance policies at a discount, or even to take out new life insurance policies to sell to investors.  For various reasons (including medical advances that have made the returns more uncertain) viaticals and life settlements fell out of favor with investors.

Now many of the same folks who made their fortunes promoting viaticals and senior life settlements have moved on to selling Structured Cash Flows (also called pension viaticals), targeting retirees with promises of a safe, income-producing product.  Unfortunately, as many baby boomers and retirees have learned, these products may be anything but safe.

What Are Structured Cash Flows

What are Structured Cash Flows?  Structured cash flows are promoted as being preferable to viaticals or life settlements because the investor doesn’t have the morbid task of waiting for the insured person to die before receiving the return on the investment.  Instead, the investor pays a lump sum in exchange for an assignment of the right to collect payments due to the seller under a pension, disability plan or other employee or government benefit program.  The investor gets to wish the seller a long life that will keep the payments coming in, the seller gets immediate cash and the middleman gets a fee.  Except that often it doesn’t work that way.

Why Are Structured Cash Flows Dangerous

What is the problem?  Most of the pension plans that are used for structured cash flows are subject to the Employee Retirement Income Security Act of 1974 (ERISA), the federal law that sets minimum standards for pension plans offered by private employers.  The ERISA law requires that employee pension plans provide that benefits may not be assigned.  Similarly, military pensions and veteran’s benefits cannot be assigned under federal law (absent limited exceptions for child support assignments and the like, which obviously do not apply to these investments).

Increasingly, pensioners and veterans are collecting the lump sum and then continuing to collect the benefits, claiming that the agreement with the investor is invalid because it violates federal law.  The middleman still gets the fee up front, so the only one who loses is the investor.

Do Investors Recieve Adequate Information

In addition to the question of whether these plans violate ERISA and veterans benefits statutes, there is the question of whether investors are receiving adequate information about the fees they are paying and the dangers associated with these investments. “The risks and costs associated with these transactions create immediate and material investor protection concerns,” warns Secretary of the Commonwealth William Galvin.

Some States Already Investigating

Regulators are looking into whether these plans violate banking laws.  In addition, at least three states – Massachusetts, New York and Arkansas – have recently initiated their own investigations into structured cash flow promoters, alleging violations of state securities laws, failure to disclose the risks and costs of these products and abusive sales practices.  While this list is not exclusive – there are many different promoters who currently sell or have sold these products throughout the country – the companies targeted in the current state investigations including the following providers:

  • LumpSum Pension Advance

  • Pension Funding LLC

  • Pensions Annuities & Settlements LLC

  • Pension Income LLC

  • Cash Flow Investment Partners

  • DFR Pension Funding

  • Veterans Benefit Leverage

  • Voyager Financial Group LLC (Pension4Case/Cash Out My Pension/Buy Your Pension)

  • First American Finance Corporation

  • Investing Forward (Termbrokers LLC)

Voyager Financial Group LLC, which also operates under the name VFG, LLC, is the defendant in a class action lawsuit and was named as a defendant in at least one individual lawsuit that was filed by an investor in federal court.

Ongoing Representation From Trusted Attorneys

Vernon Litigation Group currently represents a southwest Florida resident who purchased a Voyager Financial Group/VFG Structured Cash Flow from a financial advisor.  We suspect that many more investors in Florida and throughout the U.S. were solicited by financial advisors and insurance salesmen to purchase cash flow products offered by VFG and other promoters, but they haven’t taken action yet to try to recover their losses because they simply do not know what to do.

What should you do if you invested in a Structured Cash Flow?  DO NOT SIGN A RELEASE. Once the cash flow stops, promoters will often offer to “help” the investor recover the payments from the seller, provided that the investor first signs a release absolving the promoter of liability and agrees to pay attorneys’ fees and the costs of collection to a law firm or collection agency recommended by the promoter.

Make Sure Your Money Is Working For You

You deserve independent counsel who will act solely in your best interests to help you identify and pursue the individuals and businesses that may be responsible for your losses, not an attorney or collection agency whose first concern may be protecting the promoter from liability.