Month: March 2017

Persons receiving monthly pensions, including LAFPP retired members, may be targeted by salespersons offering immediate cash in exchange for rights to future retirement or disability retirement payments. These pension loans, or “advances,” may be offered with unlawful or unfair terms, including exceedingly high interest rates and fees.  Some pension loan agreements may also require borrowers to purchase life insurance with the lender named as the beneficiary.

On February 16, 2017, Los Angeles City Attorney Mike Feuer filed a lawsuit against an individual and multiple companies allegedly involved in a predatory lending scheme targeting vulnerable California pensioners.

The City Attorney’s lawsuit alleges that Scott Kohn, the owner and manager of a complex web of companies in California and across the country, including Cash Flow Investment Partners, LLC, Future Income Payments, LLC, London Square Specialty Services, LLC, Buysell Annuity, Inc., Pension Advance, LLC, and PAS California, LLC,  marketed and issued predatory loans to retirees in need of money to pay for unexpected expenses, securing the loans with those individuals’ pensions.  Among other things, Kohn allegedly charged interest rates as high as 96%, far above California’s 10% usury limit, and allegedly threatened borrowers (falsely) that defaulting on the loans could subject them to criminal liability.  According to the lawsuit’s allegations, Kohn also subjects pensioners in default to illegal and harassing debt collection practices, such as repeated telephone calls starting as early as 5:30 a.m.   

City Attorney Feuer seeks, among other things, an injunction prohibiting Kohn from collecting on the predatory loans issued to California pensioners, as well as selling unlawful and fraudulent loans to California investors.  In addition, the lawsuit seeks restitution for pensioners, as well as civil penalties. 

If you or someone you know has been targeted by Scott Kohn or the companies listed above, or by companies who may be engaged in similar predatory pension loan businesses, please contact the Office of the Los Angeles City Attorney at ATTpensions@lacity.org or call (213) 978-3347.

A new mural titled, “Bloom” will be painted by the artist Hueman on Neptune Building’s east-facing wall. The mural will commemorate Joel Bloom, a pioneering community activist who dedicated his personal time and energy over twenty years into creating the Arts District.

Before moving to the area in 1986, Bloom, originally from Chicago, graduated from the Pasadena Playhouse’s School of Theater Arts and served in the Air Force during the Vietnam War, where he documented the soldiers’ daily life on film. While living in the Arts District, Bloom fought to bring light-rail projects to downtown neighborhoods, advocated for affordable housing, organized a neighborhood watch program, led downtown neighborhood councils, and fought to prevent the Los Angeles Unified School District from building a massive distribution warehouse in the area. Ever the playwright and actor, Bloom also wrote and staged productions to entertain those seeking a more unique experience, like live theater that could be enjoyed from the comfort of an automobile – laughs and boos would be signaled by honking the car’s horn.

The corner of Hewitt Street and Traction Avenue, where Bloom founded Bloom’s General Store in 1994, came to be known as the heart of the community. This humble storefront provided basic everyday necessities and classic video rentals to neighborhood artists, in addition to being a local hangout.  Joel Bloom passed away on July 13, 2007 at the age of 59. “He gave the Arts District its personality, and he was unabashed in his great love for it,” said Councilwoman Jan Perry when describing Bloom as the neighborhood’s unofficial mayor. 

To celebrate the “Father of the Arts District,” the proposed mural will depict a bouquet of flowers blooming and breathing with movement, and creates a living wall symbolizing the vibrant arts community that continues to grow.

The artist bringing the mural to life is Hueman. In 2013, Hueman was one of the first artists commissioned to paint a mural after Los Angeles lifted its street art ban, and was named one of LA Weekly’s People of the Year in 2014. Her most recent mural projects include: “Mermaid on Main” located on Main and 9th in Downtown Los Angeles, California; “Inner Child” created during the RFK Mural Festival curated by Branded Arts in Los Angeles, California; “Red String of Fate” created during the Murals in the Market festival in Detroit, Michigan; and “Haiti Walls” created at the Academy for Peace and Justice in Port-Au-Prince, Haiti of the two valedictorians from the school’s very first graduating class, Class of 2016.

Painting of the mural is projected to begin in early May 2017.

Active members, log in to MyLAFPP to view and/or print your 2016 Annual Benefit Statement. 

Once logged in, simply click on the Online Paper Statement icon and then select the year of your choice. This statement summarizes your individual pension-related information and provides personal information, pension estimates (if eligible to retire), contributions and interest, domestic partner information and beneficiary designation as of December 31, 2016.

For questions concerning your statement, contact the Active Member Services Section at (213) 279-3140.

A Mural Proposal Meeting for the upcoming artwork on the LAFPP building will be taking place on March 28, 2017 at 6:30 p.m., at LAFPP Headquarters, 701 E. 3rd Street, STE 400.

The mural will be titled “Bloom” to commemorate Joel Bloom. In his lifetime, Bloom dedicated twenty years of his personal time and energy into creating the Arts District. A bouquet of flowers blooming and breathing with movement, creates a living wall symbolizing the vibrant arts community that continues to grow.

REFERENCED DOCUMENTS: 

Public Notice – Mural Proposal Meeting

A new Rockefeller Institute pension model report on the Los Angeles Fire and Police Pension Plan (LAFPP) found that “LAFPP is much better funded than most public pension plans with a funded ratio of 91%” and is well positioned financially given the conservative amortization policies and contribution policy by the City of Los Angeles.

The Rockefeller Institute pension model report on LAFPP finds that even with volatility in annual returns, the risks of severe underfunding for pension funds are greatly reduced if contribution policy is conservative and participating governments pay their full actuarially determined contributions in all years. LAFPP was one of five public plans selected for detailed study by Rockefeller researchers. This is the sixth report of the Pension Simulation Project at the Rockefeller Institute, which examines the potential consequences of investment-return risk for public pension plans, governments, and stakeholders in government.

As highlighted in the study, LAFPP spreads its investment gains and losses over fixed 20-year amortization periods in accordance with the LAFPP Board’s funding policy, which is a more conservative funding methodology when compared to agencies that may amortize gains and losses over periods of 30+ years.  Researchers also acknowledge the City of Los Angeles for its diligence in paying the full contributions determined by LAFPP’s actuaries, in contrast to many other public agencies.  This disciplined funding approach is one of the items noted in the study to minimize a plan’s chance of facing a funding crisis even if investment returns are quite volatile.  In spite of this finding, the study notes that governments still face a risk of substantial contribution increases, particularly if the plan benefits are relatively expensive, when investment volatility is greater.

The detailed study examined the potential implications of investment return volatility for public pension plans by modeling the finances of LAFPP and contributions from the City under six different investment return scenarios (both deterministic, where the Plan achieves its investment return assumption each year, and stochastic, where returns are random but follow a specific distribution).  Researchers examined the six investment return scenarios under LAFPP’s current funding policy, as well as their impact under hypothetical policies that would arise if California voters were to approve statewide pension reform initiatives similar to previously proposed initiatives which would limit employer pension contributions for new hires (see former San Jose Mayor Chuck Reed’s proposed “Government Pension Cap Act of 2016” which failed to qualify for the ballot on June 17, 2016).

The study concludes that “if LAFPP’s investment return assumption is approximately correct over the long run, the plan has very little risk of becoming severely underfunded in the next thirty years, even if investment returns vary significantly from year to year.  The main reasons for this are LAFPP’s good current funded status, its relatively conservative method of determining contributions, and our assumption that the City of Los Angeles will continue its good track record of fully paying actuarially determined contributions.”