Tr?id=566623520170033&ev=PageView&noscript=1

GWG Blames SEC Investigation Of Sales Practices For Its Collapse

Posted on May 3rd, 2022 at 1:39 PM
GWG Blames SEC Investigation Of Sales Practices For Its Collapse

From the Desk of Jim Eccleston at Eccleston Law:

In its Chapter 11 bankruptcy filings, GWG has criticized the Securities and Exchange Commission’s (SEC’s) investigation of broker-dealers that sold at least $1.6 billion of its life-settlement backed bonds as a major reason for the firm’s collapse, including GWG’s defaulting on $13.6 million in payments to bondholders. 

According to the filings, GWG contends that the SEC’s 2020 investigation of the firm eventually included the sales practice of some of the 145 broker-dealer firms that sold the bonds. The SEC’s investigation of those broker-dealers negatively impacted GWG’s reputation in the marketplace as well as the firm’s capacity to raise funds from sales of L bonds, according to the company. While GWG reported $3.5 billion of total assets and $2.1 billion in total debt, most of those assets are illiquid or hard-to-value pools of life settlements. 

According to the court filing, the SEC served a subpoena onto GWG Holdings in October 2020 relating to an investigation into the firm’s accounting procedures and issuance of bonds. According to GWG, the SEC’s investigation significantly slowed sales. GWG previously signaled an intention to file for bankruptcy protection when the firm was unable to file its 2021 annual report and accompanying financial statements after its failure to hire an auditor to replace Grant Thornton. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 
 

Tags: eccleston law, gwg holdings, sec

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

We just wanted to say thanks for your work in helping us get back some of the money we lost. We are not by any means rich, but we have saved some money and we have done so through a tight-fisted approach to most everything we do. So losing a significant chunk of money hurt…especially at a time when everyone else was growing their accounts. We really appreciate the work you did.

Allan and Adele

LATEST NEWS AND ARTICLES

1773851287 Law
March 18, 2026
LPL and Ameriprise Notify Clients of Cybersecurity Incidents Involving Account Access

LPL Financial and Ameriprise Financial Services recently notified certain clients about separate cybersecurity incidents that exposed private information and, in one case, led to unauthorized trading activity.

1773760408 Law
March 17, 2026
Bankruptcy Court Orders Emerson Equity to Produce Records in Inspired Healthcare Case

A federal bankruptcy court in Fort Worth has ordered Emerson Equity to produce documents connected to the sale of private securities issued by Inspired Healthcare Capital, according to InvestmentNews.

1773678753 Law
March 16, 2026
Concorde Investment Services Faces Scrutiny Over Sales of Inspired Healthcare Private Investments

Concorde Investment Services is facing increased scrutiny following the bankruptcy of Inspired Healthcare Capital, whose private investment offerings were widely sold through independent broker dealers, according to InvestmentNews.