SSEK Law Firm Represents Retired Missouri Couple in FINRA Arbitration Claim Against Center Street Securities Regarding Unsuitable Recommendations of GWG L Bonds
, 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.
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US Toll Free: (800) 259-9010
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SOURCE Shepherd Smith Edwards & Kantas LLP