GWG L Bonds Investor Recovery Center

GWG Holdings L Bonds Investigation (2025 Update) | Iorio Law PLLC

Iorio Law PLLC, a premier securities arbitration law firm, continues its nationwide investigation into the sales practices related to GWG Holdings Inc.’s L Bonds. If you’ve experienced investment losses due to GWG L Bonds, you’re not alone. We represent investors in FINRA arbitration claims against broker-dealers who failed to disclose the substantial risks of these speculative, high-risk, illiquid, and high-commission securities.

With bankruptcy recoveries anticipated to be minimal, investors must act promptly to pursue claims for unsuitable recommendations, misrepresentation, or non-disclosure of risks. Investors typically have six years from their purchase date to file an arbitration claim without risking dismissal for timeliness.

August M. Iorio, founder and managing attorney of Iorio Law PLLC, has already recovered over $3.5 million for GWG L Bond investors.

Contact us for a free, confidential consultation to explore your legal options.

Table of Contents for Iorio Law PLLC’s GWG L Bond Investor Recovery Center

1. Background: What Happened to GWG Holdings, Inc. and the L Bonds?
2. Bankruptcy Liquidation: Minimal Recovery Expected
3. Additional Recovery Options: FINRA Arbitration
4. FINRA and SEC Sanctions: Broker-Dealer Misconduct & Regulatory Action
5. FINRA Arbitration Awards: Investor Success (87% Win-Rate)
6. What is Securities Arbitration? Learn About FINRA Arbitration
7. Who Sold GWG L Bonds? Broker-Dealers Involved
8. Impaired Securities: The Truth About Risky GWG L Bonds
9. Why Choose Iorio Law PLLC? Experienced | Proven Track Record | Contingency Fee
10. Latest Updates: GWG L Bond Investor Updates Blog Posts
11. Detailed Timeline of GWG Holdings Events (Updated Through July 2025)

What Happened to GWG Holdings, Inc. and the L Bonds?

GWG Holdings, Inc. (GWGH) was a financial services company initially focused on life settlements, purchasing life insurance policies, paying premiums, and collecting death benefits. Due to ongoing net losses, GWG issued “L Bonds” to raise capital, selling nearly $2 billion through brokerage firms nationwide, including Emerson Equity LLC and Centaurus Financial.

The L Bonds, marketed with interest rates of 5.5% to 8.5%, were long-term, illiquid alternative investments suitable only for high-net-worth investors willing to assume significant risk.

Beginning in 2018, GWG materially altered its business model by partnering with The Beneficient Company Group, shifting focus from life settlements to alternative assets. This transformation increased financial and operational risks—a fact many investors were never told.

By early 2019, Beneficient’s management had gained control over GWG, and Beneficient’s founders seized control.

The business model shift towards riskier alternative asset investments managed by Beneficient increased the speculative and high-risk nature of GWG L Bonds.

Red flags quickly accumulated:

• Accounting issues
• Seven delayed SEC filings between 2018 and 2022
• Frequent auditor resignations
• SEC investigation(s)
• Suspension of L Bond sales for extended periods

In January 2022, GWG defaulted on its bond obligations. Three months later, the company filed for Chapter 11 bankruptcy.

2025 Bankruptcy Update: Minimal Recovery Expected

GWG’s Chapter 11 bankruptcy plan took effect on August 1, 2023. All GWG securities, including L Bonds, were canceled. In return, investors received “Series A1 WDT Interests” in the GWG Wind Down Trust.

The Plan created two trusts:

• GWG Wind Down Trust: Tasked with liquidating GWG’s assets
• GWG Litigation Trust: Charged with pursuing legal claims on behalf of creditors

As of December 31, 2024, the Wind Down Trust held just $3 million in net assets after selling nearly all of its tangible assets. In March 2025, the Litigation Trust secured settlements totaling $91.3 million. After legal fees, approximately $59.8 million is available for distribution. Expected recovery: Only 2.7%–3.45% of the original investment (About $26.94–$34.46 per $1,000 invested). No distribution date has been announced.

Additional Recovery Options Through FINRA Arbitration

Bankruptcy distributions offer little hope—e.g., a $100,000 investment might recover just $3,000. GWG L Bond investors may pursue additional compensation by filing FINRA arbitration claims against the brokerage firms or advisors who sold these unsuitable investments. These claims are separate from the bankruptcy liquidation and focus on broker misconduct.

Brokerage firms had a legal obligation to:

• Conduct reasonable due diligence
• Recommend only suitable investments
• Fully disclose all material risks

Many failed on all fronts.

Iorio Law PLLC believes that the most promising recovery path for investors is a FINRA arbitration claim. August M. Iorio has already recovered millions for affected investors.

Broker-Dealer Misconduct & Regulatory Action

GWG relied on a nationwide network of brokerage firms to distribute its L Bonds, with Emerson Equity LLC serving as the managing broker-dealer. These firms earned up to 8% in commissions—a powerful incentive that often overrode investor interests.

Our ongoing investigation reveals widespread negligence and misconduct by brokerage firms, including:

• Failure to disclose GWG’s business shift and financial instability
• Inadequate due diligence despite SEC red flags
• Misrepresentations about how investor funds were used
• Selling high-risk products to conservative or unsophisticated investors

Iorio Law PLLC’s investigation is not the only investigation into the sales practices of brokerage firms and brokers concerning GWG L Bonds. According to court filings, the SEC has been investigating the sales practices of the GWG L Bonds by the brokerage firms that sold the securities, including Emerson Equity and its network of regional broker-dealers, since mid-2021.

In addition, FINRA and the SEC have also taken action:

• FINRA: Since 2021, FINRA has issued over $675,000 in penalties and settled with at least 15 brokers and firms.

• SEC: In June 2022, the SEC filed a lawsuit against Western International Securities, Inc., and several of its brokers for Reg BI violations related to $13.3 million in L Bond sales to retail investors. The firm was accused of failing to perform due diligence regarding the inherent risks associated with L Bonds. The lawsuit also alleged that the named brokers misunderstood important issues regarding GWG Holdings, Inc. and the GWG L Bonds, including that GWG significantly changed its business model beginning in 2018 and that life insurance policies owned by GWG did not directly collateralize the GWG L Bonds. As a result, the brokers recommended GWG L Bonds to retail customers without a reasonable basis to believe that the investments were in the customers’ best interest. On July 31, 2024, the SEC announced that it had reached an agreement with Western International Securities and five of its registered representatives to settle the lawsuit. As part of the settlement, Western International Securities agreed to pay a financial penalty.

FINRA’s and the SEC’s actions confirm what we have suspected: many brokerage firms did not have the best interests of their customers in mind when they recommended GWG L Bonds.

Based on our conversations with hundreds of GWG L Bond investors from across the country, there have been widespread failures by brokers and firms to provide fair and balanced point-of-sale disclosure regarding fees, costs, and risks to retail investors.

Investor Successes: FINRA Arbitration Awards

Despite GWG’s dismal liquidation outcomes, investors have a viable path to recovery through FINRA arbitration claims against brokerage firms that recommended these unsuitable investments.

August M. Iorio, founder and managing attorney of Iorio Law PLLC, has already successfully recovered over $3.5 million for GWG L Bond investors nationwide.

Recent FINRA arbitration outcomes demonstrate growing liability:

• Lifemark Securities Corp. (May/June 2025): Lifemark Securities Corp. lost two FINRA arbitrations over the span of a couple of weeks in late May and early June 2025. In the first case (24-00901), the broker-dealer was ordered to pay $75,000 in compensatory damages and over $14,000 in expert witness costs to an elderly and unsophisticated investor who had a conservative investment objective. In the second case (24-00538), the firm was ordered to pay $58,000 in compensatory damages, plus approximately $19,700 in costs and $26,000 in attorneys’ fees.

• In January 2025, Mr. Iorio secured a FINRA arbitration award against an individual who formerly owned and controlled a brokerage firm in California (24-00004). The award is notable in that the arbitration panel found the individual liable for the firm’s sale of a risky and speculative GWG L Bond to a customer. At the arbitration hearing, Mr. Iorio argued that the individual control person was liable under California law as a “control person” of the firm.

• In February 2024, a FINRA arbitration panel in St. Louis, Missouri (22-01337), ordered Arete Wealth Management to pay $75,000 plus interest to an aggrieved GWG L Bond investor.

In total, monetary arbitration awards have been granted in 17 of 20 (85%) of FINRA arbitration cases that have proceeded to trial.

If your broker-dealer recommended GWG L Bonds without proper warnings, you may have claims for negligence, breach of fiduciary duty, fraud, or unsuitable recommendations. Mr. Iorio has recovered millions for clients in similar cases.

What is Securities Arbitration?

Securities arbitration is the legal process that most investors need to use when they want to sue their brokerage firm or registered investment advisory firm. To learn more, please review our Comprehensive Guide to Securities Arbitration.

Most claims against broker-dealers are resolved through FINRA arbitration. We have extensive experience in representing investors nationwide in FINRA arbitration. To learn more about FINRA arbitration, please visit our FINRA Arbitration Process Explained page.

Broker-Dealers Involved

GWG sold the L bonds through Emerson Equity LLC and a network of regional broker-dealers, who pitched the products to individual retail investors. The network of regional broker-dealers who sold L Bonds and shared in the selling commissions included the following firms, as well as other broker-dealers:

• Emerson Equity LLC (primary wholesaler/managing broker-dealer)
• Centaurus Financial, Inc.
• Western International Securities, Inc.
• Aegis Capital Corp.
• Ausdal Financial Partners, Inc.
• Moloney Securities Co. Inc.
• Newbridge Securities Corporation
• Arete Wealth Management, LLC
• Dempsey Lord Smith, LLC
• Great Point Capital LLC
• National Securities Corporation
• Coastal Equities, Inc. (now doing business as Realta Equities, Inc.)
• International Assets Advisory, LLC
• Capital Investment Group, Inc.
• Lifemark Securities, Corp.
• American Trust Investment Services, Inc.
• IFP Securities, LLC
• Cabot Lodge Securities LLC
• Kingswood Capital Partners, LLC
• Paulson Investment Company LLC
• Independence Capital Corp.
• Landolt Securities, Inc.
• NI Advisors
• and numerous others.

Brokerage firms are required to make investment recommendations that are suitable and in the best interest of their customers. Brokerage firms and financial advisors must also disclose all material facts and risks of a security when making a recommendation. When a firm or advisor fails to meet these standards of conduct, they can be held liable for damages.

Firms and brokers must also conduct reasonable due diligence on products they offer before recommending them to any clients. There are serious concerns that some broker-dealers recommended GWG’s L Bonds to customers without first conducting sufficient due diligence on the GWG L Bonds or GWGH.

The Truth About Risky GWG L Bonds

Even before GWG changed its business model, the GWG L Bonds were high-risk junk bonds that had the following characteristics, features, and risks:

• GWG L Bonds were illiquid.
• GWG Holdings had a limited operating history.
• GWG Holdings had a history of net losses.
• GWG Holdings significantly relied on debt financing.
• GWG Holdings used investor capital to pay out distributions (in a Ponzi-like scheme).
• GWG Holdings was highly leveraged with high debt-to-assets ratios.
• The GWG L Bonds were not directly secured by any of the life insurance policies owned by GWG Holdings.

If your financial advisor did not disclose this information to you, you may have a claim. Contact our law firm today to review your legal rights.

Timeline of Key Events (2018–2025)

A detailed chronology—available in the full below—shows a pattern of misconduct, delays, accounting failures, and regulatory scrutiny that should have raised red flags for any diligent brokerage firm.

Why Choose Iorio Law PLLC?

• ✅ Contingency Fee: No recovery, no fee
• ✅ Nationwide Representation: 700+ cases resolved across the U.S.
• ✅ Track Record: Over $3.5 million recovered for GWG L Bond investors
• ✅ Efficient Process: Most claims resolve in 6–18 months
• ✅ Tailored Advocacy: Personalized, strategic representation by an experienced securities arbitration attorney
• ✅ Client-Centric Approach: Mr. Iorio’s client reviews are a testament to how the firm effectively communicates with its clients and put their needs first.
  • ★★★★★ “[August] is responsive, efficient, and very accommodating.”- Christine L.
  • ★★★★★ “I was impressed with August Iorio’s directness and clarity in explaining the claim process and how it might work out. I also appreciated his promptness in getting back to me when I had questions or other concerns.”  – Art H.
  • ★★★★★ “[August’s] professional demeanor, partnered with his responsiveness to our questions, suggestions, and ideas, made us feel as if we were a team with a common goal. He always kept us updated and informed and gave us realistic expectations, which resulted in a timely, fair, and suitable settlement.” – EB & SB

Contact Iorio Law PLLC for Your Free Consultation

Don’t let GWG L Bond losses define your financial future. If you invested in GWG L Bonds, you deserve aggressive representation from a firm dedicated to investor recovery. Contact Iorio Law PLLC today for a confidential and cost-free case evaluation. We advocate passionately to reclaim your lost investments.

Free Consultation | No Obligation

📞 Call: (646) 330-4624
📧 Email: info@iorio.law
📍 Location: One World Trade Center, 85th Floor, New York, NY 10007
🖊️ Free Case Review: Contact Form

GWG L Bond Investor Updates Blog Posts

• GWG L Bond Investors Can Expect to Receive Approximately $26.94 to $34.46 for Every $1,000 Invested (May 1, 2025)
• GWG L Bonds Update: Investor Recovery Outlook and Wind Down Trust Report (April 2025) (April 2, 2025)
• GWG Holdings L Bond Settlement: $50.5 Million Agreement Reached with Defendants Including Beneficient and Brad Heppner – What It Means for Investors (March 7, 2025)

Detailed Timeline of GWG Holdings Events (Updated Through July 2025)

Understanding chronology helps investors build strong claims. Here’s a comprehensive timeline:

• January 18, 2018: GWG files a Form 8-K with the SEC and publishes a press release announcing a partnership with The Beneficent Company.
• August 10, 2018: GWG completed a deal with The Beneficent Company Group, L.P., and other parties, which governs the strategic exchange of assets among the parties. Beneficent Co. Group, LP, is a firm that provides financial services related to alternative assets. GWG Holdings’ indirect interests in other alternative assets are held and managed by The Beneficient Company Group, L.P. (“BEN LP,” including all of the subsidiaries it may have from time to time — “Beneficient”) and its general partner, Beneficient Management, L.L.C. Beneficient was formed in 2003 but began its alternative asset business in September 2017.
• November 19, 2018: GWG filed its 10-Q (quarterly report) late. In the filing, GWG disclosed that due to the strategic exchange of assets agreement with The Beneficent Company Group, L.P., and other parties, GWG’s financial condition, including its ability to service its debt and meet its obligations as they become due, may be materially different than what can be discerned from a review of the company’s condensed publicly released financials.
• April 2, 2019: GWG failed to timely file its 2018 year-end 10-K (annual report) with the SEC due to a delay in finalizing the accounting for certain assets and liabilities exchanged in the strategic exchange of assets agreement with The Beneficent Company Group, L.P.
• April 15, 2019: The founding stockholders of GWG sold their interests to Beneficient Company Holdings, L.P. and AltiVerse Capital Markets, L.L.C. The purchase agreement required that all sitting members of the board of directors resign. Beneficient Company Holdings, L.P. appointed the new board.
• 2018 – Early 2019: GWG entered into a series of transactions with Beneficient, an alternative asset company, that resulted in a significant reorientation of its business and capital allocation strategy towards an expansive and diverse exposure to alternative assets.
• May 1, 2019 – August 8, 2019: GWG suspended the sale of L Bonds due to delays in filing various reports with the SEC.
• June 3, 2019:  GWG, for the first time, transfers money to Beneficient. 
• July 9, 2019: GWG filed its 2018 annual financials late and disclosed that a determination that Beneficient is an unregistered investment company under the Investment Company Act of 1940 would have serious adverse consequences.
• August 5, 2019: GWG’s registered public accounting firm, Baker Tilly Virchow Krause, LLP, resigns.
• August 15, 2019: GWG failed to file its quarterly financial statement for the second quarter of 2019 on time.
• November 22, 2019: The SEC requested that GWG produce unredacted copies of select sections of the company’s Form 10-K for the fiscal year ending December 31, 2018, and 10-Q for the quarterly period ending June 30, 2019.
• March 27, 2020: GWG files earnings report including Beneficient results, which the SEC later determined to be incorrect. 
• September 23, 2020: GWG changed its independent auditor.
• October 6, 2020: GWG received a subpoena to produce documents from the SEC’s Division of Enforcement, informing GWG of the existence of a non-public, fact-finding investigation into GWG Holdings. The scope of the investigation is unknown and ongoing.
• November 17, 2020: GWG failed to file its quarterly financial statement for the third quarter of 2020 on time
• January 5, 2021: GWG received a letter from the Listing Qualifications Department of the Nasdaq Stock Market (NASDAQ) notifying the company that it was not in compliance with the requirements of Nasdaq Listing Rule 5620(a) (the “Annual Meeting Rule”) as a result of not having held an annual meeting of stockholders within twelve months of the end of the company’s fiscal year ended December 31, 2019.
• April 17, 2021 – November 2021: GWG suspended its L Bond offerings because the company was working with its auditors and the Securities and Exchange Commission (SEC) to resolve two accounting questions relevant to its late annual report for 2020.
• May 18, 2021: GWG failed to file its annual financial statement for year-end 2020 and its quarterly statement for the first quarter of 2021 in a timely manner.
• July 7, 2021: GWG disclosed that it received a letter from Nasdaq indicating that the company’s common stock was subject to delisting from Nasdaq. In addition, GWG disclosed for the first time that the company had submitted two questions to the SEC Office of the Chief Accountant on February 15, 2021. The questions submitted by GWG to the SEC were (1) whether the December 31, 2019 transaction resulted in GWG obtaining control of The Beneficent Company Group, L.P. in a transaction that constituted a change-in-control of Beneficent by entities not under common control, and (2) whether Beneficent was required to consolidate any of the ExAlt Plan trusts.
• July 26, 2021: The SEC tells GWG that some of its accounting related to Beneficient was incorrect.  Specifically, the SEC notified GWG that it would object to the company’s conclusion that Beneficent did not need to consolidate the ExAlt Plan Trusts.
• August 3, 2021: GWG disclosed that the company’s annual audited financial statements for 2019, as well as its quarterly financial statements for the first three quarters of 2020, could no longer be relied upon.
• August 17, 2021: GWG failed to file its quarterly statement for the second quarter of 2021 on time.
• November 5, 2021: GWG filed an annual report for 2020 and discloses that it has substantial doubt about its ability to continue as a going concern due to its inability to raise capital, recurring losses from operations, negative cash flow from operations, delays in executing its business plans, and potential negative implications from an ongoing SEC non-public, fact-finding investigation.
• November 15, 2021: GWG and the Beneficient Board of Directors approved a series of transactions that resulted in Beneficient becoming an independent company.
• December 31, 2021: GWG’s independent auditor, Grant Thornton LLP, resigned. The company announced that its Annual Report on Form 10-K would likely not be completed on time by the March 31, 2022, deadline.
• December 2021 – January 2022: GWG’s L Bond sales were significantly lower than previous L Bond sales results and significantly lower than the sales that the company experienced upon re-opening L Bond sales after a suspension of sales in 2019. The company has disclosed that it cannot reliably estimate when L Bond sales could return to the level that it would generally expect to assist in meeting its ongoing financial obligations.
• January 10, 2022: GWG paused L Bond sales while GWG works with its advisors to identify and evaluate options available to the company. This is significant because GWG relies significantly on L Bond sales to meet its ongoing financial obligations. GWG has disclosed that it is not likely to resume the sale of its L Bonds until it completes its 2021 annual financial statement. The company does not expect to complete an audit of its annual financials by the SEC’s March 31, 2022 deadline. Accordingly, L Bond sales are not expected to be resumed before that date.
• January 15, 2022: GWG missed interest payments of approximately $10.35 million and principal payments of about $3.25 million to L Bond owners. According to the company’s SEC filings, GWG has a 30-day grace period to make the interest and maturity payments. If GWG fails to make the interest or maturity payments within the grace period, an event of default will result. At that time, the trustee or noteholders holding at least 25% in the aggregate outstanding principal amount of Bonds may elect to accelerate the L Bonds, causing them to be immediately due and payable, subject to certain conditions and notices. GWG also continues to defer requests for redemption by investors.
• On or about January 24, 2022: GWG retained the services of restructuring financial advisors, FTI Consulting, Inc., and law firm Mayer Brown LLP, as its restructuring legal advisors to assist the company in identifying and evaluating alternatives with respect to its capital structure and liquidity, as well as available options for maximizing the value of GWG’s assets and meeting its financial obligations.
• January 24, 2022: GWG sent a notice to investors that it paused the sale of its L Bonds retroactive to January 10, 2022, and that it missed interest, maturity, dividend, and redemption payments on January 15, 2022. The notice disclosed that the company is working with its advisors and expects that the process of identifying and considering various alternatives will take at least three to six weeks and may take longer. The notice appeared to indicate that GWG Holdings did not intend to make the missed interest and maturity payments within the 30-day grace period. If that occurs, the company will be in an event of default, triggering the possibility of an acceleration of the outstanding principal.
• February 14, 2022: GWG officially defaults on its obligations to L Bond investors as the company’s thirty-day grace period expires. GWG confirms in a letter to investors that it will not make monthly interest and maturity payments on its L Bonds or dividend payments to preferred stockholders while the company continues to identify and evaluate restructuring alternatives with its advisors. GWG confirmed that it is also not accepting redemption requests while it continues the process of evaluating its options, which will take at least another three to four weeks and may take longer.
• April 1, 2022: GWG Holdings, Inc. failed to file its annual financial statement for year-end 2021 on time, missing the deadline for the third time in the past four years.
• April 20, 2022: GWG Holdings, Inc. filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of Texas. As a result of the bankruptcy filing, the accrued principal and missed interest payments of GWG L Bonds became immediately due to GWG L Bond investors; however, payment obligations are stayed as the case proceeds through bankruptcy court.
• August 1, 2023: GWG’s bankruptcy plan went into effect. As a result, all securities issued by GWG, including GWG L Bonds, were canceled, and GWG ceased operating as a business entity.
• October 2023: The GWG Wind Down Trust sells GWG’s portfolio of life insurance policies, netting only about $10 million.
• December 31, 2024: After selling nearly all of its tangible assets, the GWG Wind Down Trust had only $3 million in net assets.
• March 2025: The GWG Litigation Trust announced proposed settlements with various defendants totaling $91.3 million.
•  On June 13, 2025, the bankruptcy court approved the settlement.
•  $50.5 million Beneficient settlement announced.
• April 2, 2025: The GWG Wind Down Trust status report confirms near-worthless assets.
• June 13, 2025: The bankruptcy court approves the proposed settlements. After deducting legal fees and expenses, approximately $59.8 million of the $91.3 million will be available for distribution, resulting in a projected recovery of $26.94 to $34.46 for every $1,000 invested by a GWG L Bond investor.

This timeline reveals persistent red flags that broker-dealers should have addressed, and a nominal recovery from the GWG bankruptcy liquidation.

If you have invested in L Bonds offered by GWG Holdings, contact securities arbitration lawyer August Iorio at info@iorio.law. Alternatively, you may reach the firm by phone at (646) 330-4624.