The investors that Haselkorn & Thibaut represent have lost money on GWG l bonds. In the period from April 2012 through April 2021, GWG Holdings, Inc. (NASDAQ: GWGH), a Dallas-based provider of alternative assets, issued these high-yield bonds.
In light of GWG’s Chapter 11 bankruptcy filing on April 20, 2022, as well as its other recent financial and regulatory issues, L bond investors may now be facing substantial losses. Unaudited financial documents show that as of September 30, 2021, GWG Holdings had over $2 billion in total liabilities, including around $1.3 billion in L Bonds. The business stopped making the payments it owed investors, totaling $13.6M plus interest, in February 2022.
Investors whose broker-dealers sold them these financial instruments are represented by our skilled GWG Holdings L Bonds attorneys. Call the Haselkorn & Thibaut Law Firm at 1-888-614-9356 or send us an email to get in touch with us right away.
How Do L Bonds Work?
L Bonds are unrated, speculative, and dangerous investments that are also illiquid. A minimum investment of $25K was needed for the $1000 bills that were sold. On the secondary market, these private placements were utilized to purchase life insurance contracts. Then, policyholders would get a payment that exceeded the policy’s surrender value. The GWG Holdings L Bonds, on the other hand, attempted to offer the bondholder a higher yield in exchange for assuming the risk that the advantages or premiums might never be paid.
However, retail investors, including many retirees, aged, and cautious investors, were never a good fit for L Bonds. Additionally, creating a L Bond is not special in any way. They were probably referred to as “life bonds” by GWG as a marketing gimmick. However, there are some characteristics of L Bonds that may affect the risks and possible returns for investors.