Last Updated: November 2023
GWG Bonds –Investors are Left Holding the Bag
Here’s what you need to know about the status of now defunct Dallas, Texas- based GWG Holdings:
- Name: GWG Holdings, Inc.
- Products Sold: GWG L-Bonds
- Amount Sold: $1.6 billion in bonds backed by life settlements
- Who sold GWG L-Bonds : Independent broker-dealers nationwide. See partial list below of broker-dealers who sold GWG L-Bonds
- Status: GWG Holdings filed for Chapter 11 Bankruptcy in April 2022. Their plan of reorganization went into effect in August 2023 with the liquidation of GWG and creation of two liquidating trusts: The Wind Down Trust and the Litigation Trust. GWG’s only significant remaining assets appear to be their life insurance portfolio and an equity stake in publicly traded Beneficient (ticker BENF).
- Outlook for Bondholders–Bleak: GWG L-Bond investments are nearly worthless. Beneficient is trading at about fifty cents at the time of this writing, making GWG’s 170 million shares worth less than $100 million. Forecasts suggest that L Bondholders will likely only recover a small fraction of the $1.6 billion invested. Perhaps pennies on the dollar.
GWG L-Bonds were a high commission , high risk product not suitable for retirees looking for a conservative investment with dependable and regular income. In addition many brokers further exacerbated the problem by recommending the investment in too high a percentage of an investors liquid net worth.
Losses on GWG L-Bonds? Discuss your case with experienced investment fraud lawyer Bob Rex at (877) 224-3199 for a free consultation.
Broker-Dealers Who Sold GWG L-Bonds
Partial list of financial firms that sold GWG L-Bonds:
- Aegis Capital
- American Equity Investment Group
- American Trust Investment Services
- Arete Wealth Management
- Ausdal Financial Partners
- Cabot Lodge Securities
- Capital Investment Group
- Centaurus Financial
- Center Street Securities
- Coastal Equities
- Dempsey Lord Smith
- D.H. Hill Securities
- Emerson Equity
- G.A. Repple
- Great Point Capital
- IFP Securities
- Independence Capital
- Integrity Brokerage
- Intervest International Equities
- International Assets Advisory
- JRL Capital Corp. (filed for bankruptcy)
- Kingswood Capital Partners
- Landolt Securities
- Lifemark Securities
- Lion Street Financial
- Madison Avenue Securities
- M Stevens Securities
- Moloney Securities
- National Securities Corporation
- Newbridge Securities
- NL Advisors
- Paulson Investment Company
- Portsmouth Financial Services
- Stiba Wealth Management
- SW Financial
- TFS Securities
- The FIG Group
- Titan Securities
- Western International Securities
- Westpark Capital
Some Broker-Dealers Who Sold GWG L-Bonds May Not Survive- Leaving Investors Out in the Cold
Broker-dealers are not required to maintain insurance to cover losses in customer accounts for fraud, negligence and stockbroker malpractice. While many firms do have insurance, many do not, or the coverage they do have has a relatively low cap which may be insufficient to cover investor losses. Therefore the ability to compensate investors for their losses may be limited to the financial ability of the selling firm. Many of the broker-dealers who sold GWG L-Bonds are small companies, some of which either have no insurance or insurance with coverage that is insufficient to cover their exposure.
Small Broker Dealers can be risky to your financial health. See this for how to access the financial statements of a broker-dealer.
For example, Dallas-based broker-dealer Titan Securities shut down in June 2023. Titan, started in 2004, was a small firm with about $70 million in advisory assets. According to regulatory documents Titan recommended and sold about $1.7 million in GWG L-bonds to 51 Texas investors. With Titan out of business, investors who purchased GWG bonds from Titan have no deep pocket from which to recover their losses.
In what appears to be a meaningless gesture, The Texas State Securities Board recently entered a disciplinary order requiring Titan to return the commissions they earned on sales of GWG L-Bonds and pay an administrative fine of $20,000. With Titan out of business and the principal of Titan stating his intention to retire and not seek further registration, it’s not likely any payments will be forthcoming.
Recover Your GWG L-Bond Losses With Rex Securities Law
If you have suffered losses on GWG L-Bonds, contact us for a complimentary consultation with an experience securities lawyer to learn how you may be able to recover damages for your GWG L-Bonds through FINRA arbitration.
With offices in Boca Raton, FL and Austin, TX, stockbroker fraud attorney Bob Rex provides representation to investors nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers, financial advisors and broker dealers.
If you have questions about how your account has been handled, call (877) 224-3199 to speak with an experienced securities attorney at no cost to you.
Most cases are handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.
