Articles Tagged with GWG L Bonds

SSEK Law Firm is Representing Investors Against Centaurus Financial 

In a recent InvestmentNews column, reporter Bruce Kelly discussed how broker-dealers and their financial advisors continued selling L Bonds to customers despite indications of possible troubles at GWG Holdings, Inc. In April 2022, the alternative asset firm filed for Chapter 11 bankruptcy protection. 

The firm sold $1.6B in life insurance-backed bonds through over 140 regional brokerage firms and managing broker-dealer Emerson Equity. It is unknown what value these high-yield bonds still have or if they are worth anything at all now. Visit our L Bonds and GWG Holdings, Inc. pages to find out more.

Claimant Says He Was Never Apprised of the Risks Involved in GWG ‘Junk’ L Bonds

A retired Missouri worker has filed a six-figure Financial Industry Regulatory Authority (FINRA) arbitration claim against Titan Securities and its broker, Rodger Sprouse, over losses sustained in GWG L Bonds. The claimant, who is on disability and was forced to stop working after an injury, is an inexperienced investor. 

The claimant contends that Titan Securities and Sprouse allegedly unsuitably recommended these illiquid, speculative junk bonds without fully informing him about the risks. Sprouse is also the owner of Sprouse Financial in Lee’s Summit. 

Independent Broker-Dealer Had Partnered With Emerson Equity to Sell Risky Junk Bonds

Our experienced GWG Holdings L Bonds attorneys represent another investor in Financial Industry Regulatory Authority (FINRA) arbitration against Centaurus Financial. The claimant is a Houston retiree who entrusted his assets to the firm. Now, he is seeking up to six figures in damages.

Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) represent investors who a broker-dealer may have unsuitably sold GWG Holding L Bonds. Now that GWG Holdings, Inc. has filed for Chapter 11 Bankruptcy, L Bondholders are scrambling to recoup their losses from these high-yield bonds that may not be worth much, if anything at all, at this point.

Ex-Centaurus Financial Broker May Have Unsuitably Sold Risky Junk Bonds to Elderly Investors 

Our GWG Holdings L Bond lawyers are looking into claims of L Bond losses by former customers of Mark John Williams, an ex-Centaurus Financial broker. Williams is currently a Kingswood Capital Partners stockbroker and Financial Gravity Family Office Services investment advisor out of Carmel By The Sea, California. 

Several of his former customers, including elderly investors and retirees, have complained that he allegedly recommended and sold them GWG L Bonds. These high-yield bonds were too risky, illiquid, and speculative for these investors from the beginning. These contentions appear to be from when he was registered with Centaurus Financial and after with Forta Financial Group. 

Elderly Couple is Seeking Up to $500K Plus Interest and Costs Against Centaurus Financial 

Two older investors, both retired and on disability, have filed a Financial Industry Regulatory Authority (FINRA) arbitration claim against brokerage firm Centaurus Financial over losses they sustained from purchasing GWG L Bonds

GWG Holdings, Inc., a Dallas-based alternative asset firm, filed for Chapter 11 bankruptcy in April 2022. Now, this Texas couple is among the many thousands who have been left holding these high-risk, illiquid junk bonds that may not be worth much at all at this point.

Los Angeles-Based Financial Advisor Allegedly Targeted Customers of Iranian Heritage

In an earlier GWG L Bond blog post, our securities attorneys reported we were looking into whether customers of Emerson Equity broker Tony Barouti had suffered losses in these high-yield bonds. In March 2022, investors filed two investor claims seeking $1.37M in damages.

Brokerage firm Emerson Equity is the managing broker-dealer for the GWG issuer of $1.6B of L bonds, backed by life settlements. On April 20, 2022, GWG Holdings, Inc. filed for Chapter 11 bankruptcy protection. The move came just two months after the Texas-based alternative asset firm defaulted on $13.6B in bond payments and interest it owed L Bond investors. 

Despite Misgivings, Court Approves $10M Financing for Troubled GWG Holdings

One day after GWG Holdings filed for Chapter 11 bankruptcy protection, Judge Marvin Isgur of the US Bankruptcy Court in Houston approved $10M in financing for the asset manager despite his concerns regarding the mechanics of the loan. The emergency loan will come from National Founders LP. 

According to The Wall Street Journal (WSJ), in court papers, GWG said it needed the money to avoid “imminent liquidation.” The Texas-based alternative asset firm owes about $1.6B in L Bonds. Despite being illiquid and high-risk, these high-yield bonds were mainly marketed to individual investors by around 145 regional brokerage firms, including managing broker-dealer Emerson Equity. They earned high commissions of around 8% from the transactions. 

High-Yield GWG L Bonds May Now Be Worth 20 to 30 Cents on The Dollar

Our high-yield bond lawyers investigate brokerage firms that sold  GWG L Bonds to their customers. On April 20, 2022, GWG Holdings, Inc., the issuer of these junk bonds, announced that it had filed for Chapter 11 bankruptcy protection. 

The news comes in the wake of a slew of troubles involving the Texas-based alternative firm. GWG Holdings owes investors $13.6M in principal payments plus interest and is way behind in submitting yearly regulatory filings. It also has been under investigation by the US Securities and Exchange Commission (SEC) since 2020. 

Issuer of L Bonds Says SEC’s Probe Contributed to Its Demise

In the US Bankruptcy Court for the Southern District of Texas on April 20, 2022, GWG Holdings, Inc. (GWGH) voluntarily filed for Chapter 11 bankruptcy protection. The move was expected in the wake of the regulatory and financial woes plaguing the Dallas-based alternative firm. 

GWG Holdings’ bankruptcy is bad news for investors, many of whom are retail customers, including elderly investors and retirees. In February 2022, the company, which sold $1.6B in life-settlement backed bonds via independent brokerage firms, had defaulted on $13.6M in principal payments and interest it owed investors of its L Bond series. 

Dallas-Based Alternative Asset Firm Expected To Seek Bankruptcy Protection Very Soon 

According to sources, GWG Holdings, Inc. (NASDAQ: GWGH) is preparing for Chapter 11 bankruptcy. The reports come after the Texas-based alternative asset firm notified the Securities and Exchange Commission (SEC) in an April 1, 2022 filing that it could not submit its 2021 yearly report and other financial statements. The firm has yet to retain an auditor since Grant Thornton stepped down from that role in December 2021. 

Not having an auditor for this long can signify that a company is planning to seek bankruptcy protection. However, according to InvestmentNews, a GWG spokesperson refused to comment about such preparations when questioned. 

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