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GWG Fails to Meet Filing Obligations to NASDAQ as L Bond Investors Brace for GWG’s Possible Bankruptcy

April 13, 2022

On April 6, 2022, GWG Holdings issued a press release stating that it had received a letter from Nasdaq’s Listing Qualification Department that the company was not in compliance due to not failing its Annual Report on Form 10-K. The Nasdaq letter coincides with the Wall Street Journal’s recent reporting concerning GWG’s potential Chapter 11 bankruptcy plans. National investment fraud lawyers is continuing to investigate GWG L Bonds sales in light of developing news regarding the company’s missed financials, ongoing SEC investigation, and missed interest and principal payments.

What is Nasdaq’s Listing Qualification Department?

The Nasdaq has rules relating to the rules to the qualification, listing and delisting of companies on The Nasdaq Stock Market. Rule 5250(c) requires companies to file periodic financial reports when it states:

                (c) Obligation to File Periodic Financial Reports

(1) A Company shall timely file all required periodic financial reports with the Commission through the EDGAR System or with the Other Regulatory Authority. A Company that does not file through the EDGAR System shall supply to Nasdaq two (2) copies of all reports required to be filed with the Other Regulatory Authority or email an electronic version of the report to Nasdaq at continuedlisting@nasdaq.com. All required reports must be filed with Nasdaq on or before the date they are required to be filed with the Commission or Other Regulatory Authority. Annual reports filed with Nasdaq shall contain audited financial statements.

GWG Holdings stated that the Nasdaq letter “has no immediate effect on the listing or trading of GWGH’s common stock on the Nasdaq Capital Market [and] … [GWG is] required to submit a plan to regain compliance with Rule 5250(c)(1) within 60 calendar days from the date of the Letter. If the plan is accepted by Nasdaq, then Nasdaq can grant the company up to 180 calendar days from the due date of the Form 10-K to regain compliance.”

GWG Failed to Timely File its Annual Report with the SEC

On April 1, 2022, GWG Holdings filed a Notification of Late Filing stating that the company is unable to file its Annual Report within the prescribed time period because GWG requires additional time to complete its financial statements and related disclosures.

GWG’s prior independent registered public accounting firm had previously notified the firm that it will not stand for reappointment as GWG’s independent registered public accounting firm. The Company stated in its April 1, 2022 filing that it had not yet engaged an auditor to audit its financial statements for the year ended December 31, 2021, but was in the process of reviewing potential candidates.

Emerson Equity Among the Brokerage Firms that Sold GWG L Bonds

GWG Holdings, through its subsidiary, GWG Life, LLC, owns and manages a portfolio of life insurance policies. GWG created products known as L Bonds, which pooled money from bond investors to purchase life-insurance policies on the secondary market, and then used payouts from the policies when people died to repay the investors.

Emerson Equity was the managing broker-dealer for the sale of GWG’s L bonds. Many L bond investors are reportedly elderly or retired. Other brokerage firms that reportedly sold GWG L bonds include:

  • Cabot Lodge Securities
  • Capital Investment Group
  • Centaurus Financial
  • Coastal Equities
  • Ni Advisors
  • Landolt Securities
  • Lion Street Financial (Stiba Wealth Management)
  • National Securities
  • SW Financial

Recover GWG L Bond Investment Losses

National investment fraud lawyers KlaymanToskes is continuing to investigate the sales practices of full-service brokerage firms relating to GWG’s L bonds. Investors with losses in excess of $250,000 in GWG’s L Bonds, and those who have information relating to the handling of their accounts at full-service brokerage firms regarding GWG’s L bonds, are encouraged to contact Lawrence L. Klayman, Esq. at 888-899-2044.

About KlaymanToskes

KlaymanToskes is a leading national securities law firm practicing exclusively in the field of securities arbitration on behalf of retail and institutional investors throughout the world in large and complex securities matters. The firm has recovered more than $230 million for investors in FINRA arbitrations. KlaymanToskes has office locations in California, Florida, New York, and Puerto Rico.

Contact Us for Information on our GWG L Bond Investigation

KlaymanToskes

Lawrence L. Klayman, Esq. (561) 542-5131

lklayman@klaymantoskes.com

www.klaymantoskes.com