Securities Arbitration Lawyer Blog
On August 1, 2023, GWG Holdings, Inc.’s Chapter 11 bankruptcy plan (the “Plan”) went into effect.
As part of the Plan, GWG will be liquidated, and two liquidating trusts have been created: (i) the Wind Down Trust and (ii) the Litigation Trust.
As a result of the Plan going into effect, all securities issued by GWG, including GWG L Bonds, were canceled. L Bondholders received “New Series A1 WDT Interests” in the Wind Down Trusts.
For GWG L Bondholders whose L Bonds were held of record in the name of a bank, broker, or other holder of record through the facilities of the Depository Trust Company), the New WDT Interests will continue to be held in the same manner. GWG recommends that investors contact their bank, broker, or other record holder for further information.
For GWG L Bondholders whose L Bonds were held directly, the New WDT Interests will continue to be held directly. Computershare Trust Company, N.A. (“Computershare”) has been appointed as the transfer agent and registrar for New WDT Interests, and direct holders may access further information with respect to their New WDT Interests as described below:
- If a direct GWG L Bondholder already has an existing Computershare account under the same name and Tax ID as shown on the statement mailed to the bondholder by Computershare, the units of New Series WDT Interests will be automatically added to that bondholders’ account on Investor Center, Computershare’s online and mobile portal to your portfolio.
- If a direct GWG L Bondholder does not have an existing Computershare account, they should register for an account at www.computershare.com/investor. These bondholders will need their “Account Number,” which can be found on the statement mailed to you by Computershare. and direct holders may access further information with respect to their New WDT Interests as described below.
What are GWG’s Assets?
GWG has only four primary assets: (1) its portfolio of life insurance policies; (2) equity interest in FOXO, (3) equity interest in Beneficient; and (4) potential legal actions against third parties, primarily Beneficent.
The Wind Down Trust will hold the portfolio of life insurance policies and the company’s equity interests in FOXO and Beneficent and make efforts to monetize those assets over time. The sale of these assets may take several years, and the amount that GWG will recover remains uncertain.
According to GWG’s analysis in the bankruptcy proceedings, the projected net residual value from the sale of the life insurance policies is projected to be $0 to $78 million, and the equity interest in FOXO is nominal, $3.3 million.
With over $1.3 billion owed to L Bondholders, for the L Bonds (now New Series A1 WDT Interests) to have any significant residual value, GWG must monetize its equity interest in Beneficient or its legal claims against third parties.
How and when GWG will be able to monetize its equity interest in Beneficient remains uncertain and speculative.
Since going public on June 8, 2023, and opening at $15 on the first day the new BENF traded, the stock price has plummeted to under $2 per share.
To read more about the residual value of the L Bonds, please see our blog post from mid-July: GWG Bankruptcy Update (July 14, 2023): The Residual Value of the GWG L Bonds Remain Suspect as Beneficient Receives a Wells Notice from the SEC.
We continue to believe that GWG L Bonds investors’ best avenue for potential recovery of losses is to file a separate FINRA arbitration claim against their brokerage firms. If you would like more information about how to file a claim, please respond to this email to schedule a free and confidential consultation.
To read more about the alleged misconduct, please visit our other blog posts:
What L Bondholders Need to Know About GWG Holdings, Inc.’s Chapter 11 Plan
Broker-Dealers Sold GWG L Bonds Using Aggressive and Misleading Marketing
“GWG Was a Classic Ponzi Scheme” – Official Committee of Bondholders of GWG Holdings, Inc.
Iorio Altamirano LLP (gwglawyer.com), a law firm that represents retail investors, is representing many GWG L Bond investors against brokerage firms across the country to recover investment losses and damages sustained by those firms’ recommendations to invest in GWG L Bonds. Based on the law firm’s investigation, there appears to have been widespread negligence and misconduct by many brokers and broker-dealers across the country. Iorio Altamirano LLP has already helped GWG L Bond investors recover nearly $1 million in losses.
For the latest on Iorio Altamirano LLP’s investigation of GWG L Bonds, including a key event timeline, visit our firm’s investigation page: Iorio Altamirano LLP’s Investigation of GWG L Bonds.
About Iorio Altamirano LLP
Iorio Altamirano LLP is a securities arbitration law firm located in New York, NY. We represent investors nationwide and vigorously pursue FINRA arbitration claims on behalf of investors to recover investment losses.
We have over 20 years of combined experience as securities arbitration lawyers and have helped investors recover investment losses in over 1,000 cases. Our firm will file a FINRA securities arbitration claim on your behalf on a contingency fee basis to try to recover your losses. If we do not obtain a recovery, you do not owe us a legal fee.
If you have invested in L Bonds offered by GWG Holdings, contact securities arbitration lawyers August Iorio at august@ia-law.com or Jorge Altamirano at jorge@ia-law.com. Alternatively, call the firm toll-free at (855) 430-4010.