From the sunny cornfields of Kansas to the high rise offices in Missouri, a storm is brewing – one that involves a married couple, financial investments and a well-known securities company. The essence of the narrative hinges upon the actions of Edward H Prince, a seasoned broker with 19 years of experience in the securities industry and the firm he represents, Moloney Securities Co., Inc.
High Stakes in Play for Kansas Couple
Stepping into the spotlight are the claimants, a married couple from Kansas, regular folks who kicked off 2021 pinning their retirement hopes on what they believed to be stable investment recommendations made by their trusted broker, Prince. Fast forward to April 2022, these same recommendations have greatly undermined their financial security, exposing roughly 90% of their investment to potential losses due to bankruptcy.
That’s right, we’re talking about a staggering sum of $140,000, that was recommended by Edward H Prince to be invested in the GWG L bonds in or about January 2021.
The Unanticipated Road to Bankruptcy
Now, photos of golden retirement on a Kansas porch were thrown out of focus when the investment vehicle, GWG Holdings, filed Chapter 11 bankruptcy. Red flags were already raised in December 2021 when GWG Holdings didn’t make their $10,350,000 interest payment and $3,250,000 principal payment slated for January 15, 2022.
Despite this increasingly grim scenario, the suit alleges both Prince and Moloney Securities Co., Inc. chose to turn a blind eye, making no attempts to liquidate the bonds. The central issue at play here is the suitability (or seeming lack thereof) of such an unprecedented concentration of retirement funds, into what was essentially high-risk, unrated junk bonds.
Financial Impact and FINRA Violation Overview
So although sunset years were dappled in the financial chaos, a valiant battle is now being fought in the courtroom where allegations of negligence, negligent supervision, and breach of fiduciary duty are being raised against Prince and Moloney Securities Co., Inc. The lawsuit suggests these purported actions caused damages totalling approximately $140,000.
Central to many of these claims is the breach of FINRA regulations. These violations tend to revolve around the infringement of investor interests under an “over-concentration” context, where a hefty sum of investment is poised in risk-ridden securities, contrary to the conservative risk tolerance of the investor.
If you’ve too had your financial stability shaken due to investment recommendations from Moloney Securities or Prince, particularly in GWG L Bonds, recovery of investment losses through a FINRA arbitration may be possible. Reach out to an experienced securities lawyer at: 888-760-6552.
All eyes are now on the court as it deliberates this captivating tale of investments gone wrong, in hopes that justice will be served and lessons will be learned. Ongoing it might be, but this saga serves as a reminder for us all of the oft-overlooked truth: investments can be risky, and the price for not adequately considering the potential pitfalls could be irreversibly steep.