, April 6,
2022 /PRNewswire/ -- (Republic) A retired couple from
Missouri has filed a six-figure
claim against Center Street Securities over losses sustained in GWG
Holdings, Inc. (NASDAQ: GWGH). Both inexperienced investors
with health issues, the claimants had entrusted the brokerage firm
with keeping their money safe.
Instead, their Center Street Securities broker Joe Latour, a registered investment advisor
with the Latour Financial Group, unsuitably recommended and sold
them GWG L Bonds, while neglecting to give a full picture of the
risks.
In their claim, the couple alleges
negligence, misrepresentations and
omissions, unsuitability, overconcentration, gross
negligence, fraud, breach of contract, and other contentions. Our
securities attorneys represent these older retirees in their FINRA
arbitration claim against Center Street Securities.
If you sustained losses in these high-risk bonds that were sold
to you by your brokerage firm, call Shepherd Smith Edwards and
Kantas (SSEK Law Firm at investorlawyers.com) today
at (800) 259-9010.
GWG L Bonds Were Too Risky, Illiquid, and Highly Speculative
for These Retirees
At the recommendation of Center Street Securities, the claimants
invested $134K into L Bonds. These
bonds are junior debt, unlisted, issued with 6-month to 7-year
maturity dates, and callable in that GWG Holdings can repurchase
them without penalty and at a loss to investors.
There is no way for someone to sell their L Bonds early. These
bonds renew automatically unless the investor requests otherwise
before their maturity. Over 50% of outstanding GWG L Bonds were not
repaid upon maturity. Instead, they were simply replaced with
another bond.
Not only that, but bond repayments to investors were like
a Ponzi scheme in that they came from the sale of L bonds
to new investors.
Set up to earn non-correlated returns from life insurance
assets, GWG Holdings was supposed to generate opportunities for
consumers to receive substantially more value from their life
insurance policies in a secondary market than they would from more
traditional options. Instead, GWG Holdings has cost investors many
millions of dollars.
In February 2022, GWG Holdings
defaulted on the $3.25M in principal
payments and $10.35M in interest it
owed investors. But signs of trouble were clear even before
2022.
Our investment fraud lawyers continue to investigate and pursue
the many broker-dealers that unsuitably sold L Bonds to
investors.
Free Consultations:
US Toll Free: (800) 259-9010
ksmith@sseklaw.com
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SOURCE Shepherd Smith Edwards & Kantas LLP