Securities Arbitration Lawyer Blog
FINRA has suspended stockbroker John A. Westbrook (CRD #1846059) for five months from the securities industry and ordered him to pay a $5,000 fine. These sanctions arose from Mr. Wesbrook’s solicitation of Future Income Payments, LLC. This blog has previously written about Future Income Payments, LLC.
FINRA alleged that between October 1, 2016, and May 9, 2017, John Westbrook participated in private securities transactions totaling $350,335, without prior disclosure and approval from his employer at the time, Center Street Securities, Inc. Specifically, FINRA alleged:
- Between October 1, 2016, and May 9, 2017, Mr. Westbrook solicited three investors to purchase $350,335 in securities of Future Income Payments, LLC.
- Future Income Payments, LLC represented itself as a structured cash flow investment that purchased pensions at a discount from pensioners and then sold a portion of those pensions as a “pension stream to investors.”
- Future Income Payments, LLC reportedly promised investors a 6.5% to 8% rate of return.
- Westbrook received a total of $14,013 in commissions associated with his sales of Future Income Payments, LLC.
- Center Street Securities, Inc. prohibited its financial advisors from participating in private securities transactions without prior written approval from the firm.
- Westbrook did not provide notice to Center Street Securities, Inc. before soliciting investors to purchase securities of Future Income Payments, LLC.
In April 2018, Future Income Payments, LLC ceased business, owing nearly $300 million in unpaid investor payments to over 2,600 individuals. In March 2019, Future Income Payments, LLC and its owner, Scott A. Kohn, were indicted by a Federal Grand Jury alleging a conspiracy to engage in mail and wire fraud. According to the indictment, Future Income Payments, LLC operated a Ponzi scheme.
Mr. Westbrook was a financial advisor at Center Street Securities, Inc. in Montgomery, Alabama, from September 2014 until February 2020. Center Street Securities, Inc. terminated him in February 2020 for allegedly failing to follow firm policy and procedures.
Brokerage firms like Center Street Securities, Inc., must properly supervise financial advisors and customer accounts. Brokerage firms must also establish and maintain a reasonably designed system to oversee account activity, such as private securities transactions, to ensure compliance with securities laws and industry regulations. When a brokerage firm fails to sufficiently supervise its financial advisors or the investment account activity, it may be liable for investment losses sustained by customers.
According to public records, at least one customer has already filed a FINRA arbitration complaint against Mr. Westbrook and Center Street Securities, Inc. related to the solicitation of Future Income Payments, LLC.
If you have lost money because you invested in Future Income Payments, LLC, contact New York securities arbitration lawyer August Iorio of Iorio Altamirano LLP. August Iorio can be reached at august@ia-law.com or toll-free at (855) 430-4010 for a free and confidential evaluation of your account.
Iorio Altamirano LLP is a boutique law firm located in the heart of New York City. Iorio Altamirano LLP represents investors nationwide who have suffered investment losses due to securities fraud.
Iorio Altamirano LLP is a bilingual law firm, fluent in both English and Spanish.