Consumer Financial Protection Bureau v. Pension Funding, et al

Updated 06/12/2019

When will investors receive their money back and how much will they get?
The Receiver completed her forensic accounting of funds received and disbursed by the receivership entities. The Court also approved the Receiver’s recommendation regarding the collection of amounts due from pensioners and the process for determining the proper amount of investor claims. The Court has ordered Pensioners to pay back the lump-sums received and ordered the Receiver to complete the investor claims process. The Receiver sent out correspondence to all Pensioners and Investors reflecting the Court’s order details, and sent all Investors their Claim Notices with specific instructions and a February 26, 2017 response deadline (see FAQ further below).

A copy of the Court’s order can be found below – the “Order Approving in Part the Receiver’s Report and Recommendations”.

With the claims process completed, the Receiver filed a proposed distribution plan with the Court and requested permission to make interim distributions to Investors. The Court approved the Receiver’s proposed distribution plan and the Receiver issued the initial interim distributions by the end of the third quarter 2017. Please refer to the Exhibits (particularly Exhibit B) of the “Declaration of Krista L. Freitag, Court-Appointed Receiver, in Support of Motion for (A) Approval of Proposed Allowed Claim Amounts; (B) Approval of Distribution Plan; and (C) Authority to Make Interim Distributions” posted below.

A copy of the Court’s order approving the distribution plan can also be found below – the “(In Chambers) Order Granting Motion for (1) Approval of Proposed Allowed Claim Amounts, (2) Approval of Distribution Plan, and (3) Authority to Make Interim Distributions (Doc. 139).”

The Court has now approved and authorized, amongst other things, the Receiver to Make Final Distributions to Approved Claimants [who successfully negotiated the interim payment] and Establish a Reserve; Approving Final Accounting and Report; Approving Disposition of Books and Records; and Conditionally Discharging Receiver. A copy of said order and other information can be found below.

Based on the timeline approved by the court, the Receiver has issued the final distribution payments.

Are pensioners required to make payments they owe to the receivership entities?
Yes. As mentioned above, the Court ordered Pensioners to pay back lump sums they received.

What is the deadline for Investors to respond to the Claims Notices?
In late December 2016, all Investors were sent a copy of his/her Claims Notice via USPS certified/return receipt by the Receiver. The February 26, 2017 deadline has passed and the Court has ordered any/all claims submitted on or after March 1, 2017 to be disallowed.

• Order Entering Stipulated Preliminary Injunction, Appointment of a Receiver, and Related Matters
• Complaint for Violations of the Consumer Financial Protection Act and New York Banking and Financial Services Laws
• Parties’ Joint Stipulation Requesting Entry of Stipulated Final Judgment and Order as to Defendants Edwin Lichtig, Rex Hofelter, Pension Funding, LLC, and Pension Income, LLC
  1. Declaration of Carmen Christopher
  2. Stipulated Final Judgment and Order as to Defendants Edwin Lichtig, Rex Hofelter, Pension Funding, LLC, and Pension Income, LLC
• Receiver’s Motion for Order in Aid of Receivership, Initial Report on Receiver’s Activities
  1. Plaintiff’s Non-Objection re: Receiver’s Motion for Order in Aid of Receivership
• Receiver’s First Interim Report and Initial Inventory
• Notice of Hearing on First Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, For Payment of Fees and Reimbursement of Expenses
  1. First Interim Fee Application of Receiver, Krista L. Freitag
  2. First Interim Fee Application of Allen Matkins, General Counsel to the Receiver
  3. Order Approving First Interim Fee Applications
• Receiver’s Second Interim Report
• Notice of Hearing on Second Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, For Payment of Fees and Reimbursement of Expenses
  1. Second Interim Fee Application of Receiver, Krista L. Freitag
  2. Second Interim Fee Application of Allen Matkins, General Counsel to the Receiver
• Notice of Hearing on Second Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, For Payment of Fees and Reimbursement of Expenses (Note The Hearing Date Has Been Moved From September 30, 2016 To October 21, 2016 At 2:30 Pm)
  1. Second Interim Fee Application of Receiver, Krista L. Freitag
  2. Second Interim Fee Application of Allen Matkins, General Counsel to the Receiver
• Order Granting Second Interim Fee Applications
• Receiver’s Forensic Accounting Report and Recommendations
  1. Order Approving, in Part, the Receiver’s Report and Recommendations
  2. Receiver’s Ex Parte Application for Order for Approval of Recommended ADR Procedure for Investor Claim Disputes
  3. Order Denying the Receiver’s Ex Parte Application and Adopting a Revised Investor Dispute Resolution Process
• Receiver’s Third Interim Report
• Notice of Hearing on Third Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
  1. Third Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Third Interim Fee Application of Allen Matkins, General Counsel to the Receiver, for Payment of Fees and Reimbursement of Expenses
  3. Minute Order Granting the Third Interim Fee Applications of Receiver and Receiver’s Counsel

• Receiver’s Fifth Interim Report
• Notice of Hearing on Fifth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
  1. Fifth Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Fifth Third Interim Fee Application of Allen Matkins, General Counsel to the Receiver, for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Fifth Interim Fee Applications of Receiver and Receiver’s Counsel
• Receiver’s Sixth Interim Report
• Notice of Hearing on Sixth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
  1. Sixth Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Sixth Interim Fee Application of Allen Matkins, General Counsel to the Receiver, for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Sixth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
• Receiver’s Seventh Interim Report
• Notice of Hearing on Seventh Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
  1. Seventh Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Seventh Interim Fee Application of Allen Matkins, General Counsel to the Receiver, for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Seventh Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses

• Receiver’s Eighth Interim Report
• Notice of Hearing on Eighth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
  1. Eighth Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Eighth Interim Fee Application of Allen Matkins, General Counsel to the Receiver, for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Eighth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
• Receiver’s Ninth Interim Report
• Notice of Hearing on Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals for Payment of Fees and Reimbursement of Expenses
  1. Ninth Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Ninth Interim Fee Application of Allen Matkins Leck Gamble Mallory & Natsis LLP, General Counsel to the Receiver for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Ninth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
• Receiver’s Tenth Interim Report
• Notice of Hearing on Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals for Payment of Fees and Reimbursement of Expenses
  1. Tenth Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Tenth Interim Fee Application of Allen Matkins Leck Gamble Mallory & Natsis LLP, General Counsel to the Receiver for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Tenth Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses
• Receiver’s Eleventh Interim Report
• Notice of Hearing on Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals for Payment of Fees and Reimbursement of Expenses
  1. Eleventh Interim Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Eleventh Interim Fee Application of Allen Matkins Leck Gamble Mallory & Natsis LLP, General Counsel to the Receiver for Payment of Fees and Reimbursement of Expenses
  3. Order Approving Eleventh Interim Fee Applications of Krista L. Freitag, Receiver, and Her Professionals, for Payment of Fees and Reimbursement of Expenses

• Notice of Motion and Motion to Conclude Receivership and For Order: (1) Authorizing Receiver to Make Final Distributions to Approved Claimants and Establish Reserve; (2) Approving Final Accounting and Report; (3) Approving Disposition of Books and Records; and (4) Conditionally Discharging Receiver; Receiver’s Final Accounting and Report
  1. Order to Conclude Receivership and (1) Authorizing Receiver to Make Final Distributions to Approved Claimants and Establish Reserve; (2) Approving Final Accounting and Report; (3) Approving Disposition of Books and Records; and (4) Conditionally Discharging Receiver.
• Notice of Hearing on Final Fee Applications of Krista L. Freitag, Receiver, and Her Professionals for Payment of Fees and Reimbursement of Expenses
  1. Final Fee Application of Krista L. Freitag, Court-Appointed Receiver, for Payment of Fees and Reimbursement of Expenses
  2. Final Fee Application of Allen Matkins Leck Gamble Mallory & Natsis LLP, General Counsel to the Receiver for Payment of Fees and Reimbursement of Expenses
  3. Order (1) Granting Receiver’s Final Application for Payment of Fees and Reimbursement of Expenses; and (2) Granting General Counsel’s Final Application for Payment of Fees and Reimbursement of Expenses
• Declaration of Krista L. Freitag Regarding Accounting of Reserve and Completion of Closing Tasks; Request for Entry of Order Discharging Receiver and Closing Receivership
• Order Discharging Receiver and Closing Receivership