The Texas securities regulator John Morgan, ordered SoBell Corp, a Mississippi-based firm, to stop selling investments in pension benefits in its “Pension Income Stream Program” in Texas. Many of the targets in these pension income streams are veterans or disabled people; those people who receive monthly distributions of money following service in the military or settlements from personal injury lawsuits. They are approached by salespeople offering them a lump sum to buy the rights to some or all of the payments they would otherwise receive in the future. After acquiring these rights, these pension purchasing or structured settlement companies (factoring companies) turn around and sell the income streams to retail investors, often through a financial advisor or insurance agent. These include pension loans, pension income programs, mirrored pensions, factored structured settlements or secondary-market annuities.
SoBell executed agreements with the recipients of pension benefits to sell their income stream to investors for at least $35,000 to more than $1 million, offering annual returns of seven to eight percent. Allegedly, SoBell and its owner, Andrew Gamber, were accused of fraud by selling unregistered securities while making “misleading and deceiving” statements to investors, according to the Texas securities regulator. Also, Mr. Gamber also allegedly failed to disclose sanctions that state securities regulators imposed against him from 2013 until 2014 in Arkansas, Pennsylvania, California and New Mexico. The emergency cease and desist order for SoBell and Gamber was issued last week. These pension streams can be extremely risky for investors.
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