ALBUQUERQUE, N.M. — The state Regulation and Licensing Department’s Securities Division said Tuesday it has ordered two investment companies involved in the illegal purchase of monthly pensions and disability payments from veterans and resale of them as investments to halt the scheme immediately.
Securities Division Director Alan R. Wilson issued a cease and desist order Monday against Albuquerque-based Equity Advisors and its owner Sidney Evans, and Voyager Financial Group, a Delaware LLC that previously was based in Arkansas.
Federal law prohibits the sale or assignment of veterans’ benefits. Also, secondary sales of Veterans Administration payments constitutes a “security” under the New Mexico Uniform Securities Act. Under that Act, the securities were to be registered and disclosures were to be accurate. Voyager and Evans failed to comply with either.
Evans did not respond to the Journal’s request for comment Tuesday. Attempts to reach Voyager Financial Group were unsuccessful.
Voyager would buy veterans’ monthly pension and disability payments for single lump sum that was far less than the future value, and then package them as investments to be sold to investors, the department said in a news release.
The investors who purchased the contracts were not told the scheme was in violation of law, and therefore, the payments could be diverted back to the veterans at any time.
Evans and his company sold 16 of these investments to eight New Mexico residents while Voyager has sold these illegal investments in several states through consultants such as Evans at least since 2011, the department said.
Anyone who has been contacted to buy or sell veterans’ benefits should contact the New Mexico Securities Division at 1-800-704-5533.
The Securities Division plans to impose $40,000 in civil penalties each against the companies.