Oakes and Fosher is investigating Rene Javier Castro with Great Point Capital and previously with Center Street Securities for the sale of GWG Bonds.
Rene Javier Castro was recently the subject of another arbitration alleging the unsuitable recommendation of GWG Bonds. Castro has been licensed in the securities industry since 1994 and registered with 16 different FINRA–licensed brokerage firms.
Castro has recently been the subject of four separate customer complaints alleging the recommendation of unsuitable securities, specifically the sale of GWG Bonds.
What Are GWG Bonds?
GWG Bonds were issued by GWG Holdings, a company that purchased life insurance policies from individuals seeking immediate funds. There are allegations that GWG Holdings was essentially a Ponzi scheme, issuing new bonds to pay off investors of the initial bonds while the company continued to lose money and pay the high salaries of its officers.
These bonds were misrepresented to investors as safe and secure fixed-income products that would pay a fixed rate of income. The bonds were sold to many retirees, who relied on a monthly income for support.
The Ponzi Scheme
A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or the money paid by subsequent investors rather than from profits earned by the individual or organization running the operation. The Ponzi scheme is named after Charles Ponzi, who became notorious for using the technique in the 1920s.
- The scheme’s creator promises investors high returns with little or no risk.
- The scheme’s creator then uses money from new investors to pay off old investors, creating the illusion of success.
- As long as there is a steady flow of new investors, the scheme can continue to pay off old investors.
- However, the scheme eventually collapses when it becomes too difficult to find new investors or its creator runs out of money.
Red flags that may constitute a Ponzi scheme, such as those characteristic of Rene Castro selling GWG Bonds, include:
- Promises of high returns with little or no risk.
- Unregistered investments.
- Lack of transparency about how the investment works.
- Pressure to invest quickly.
- Restrictions on withdrawing money.
What Can Holders of GWG Bonds Do?
GWG Holdings filed for bankruptcy, and the holders of these bonds will be left with little to no recourse in bankruptcy court. Filing a claim with the Financial Industry Regulatory Authority (FINRA) is an avenue of recourse for investors who have suffered losses from the sale of GWG Bonds by Rene Castro. The process involves the submission of a Statement of Claim that outlines the nature of the dispute, the parties involved, and the requested relief.
Investors can benefit from the guidance of an attorney, such as Bruce D. Oakes or Richard B. Fosher of Oakes & Fosher, LLC, experienced in securities fraud and arbitration. Our securities fraud attorneys will help compile the necessary documentation, navigate the rules and procedures of the arbitration process, and effectively present your case. It’s important to note that you must file a claim within six years of the event or occurrence giving rise to it.
If a panel of arbitrators finds in favor of the investor, they may award damages to cover the financial losses experienced due to the unsuitable or fraudulent sale of the bonds. The panel may also award relief such as interest, attorneys’ fees, and costs. While FINRA arbitration can be daunting, you can pursue and potentially recover your losses with the proper legal counsel.
Contact Us If You’ve Suffered Losses From the Sale of GWG Bonds by Rene Castro
Oakes & Fosher represents numerous holders of GWG Bonds in FINRA arbitration and has recovered losses for these bondholders. If you or someone you know lost money in GWG Bonds with Rene Castro or any other broker, please give the attorneys at Oakes & Fosher a call. Oakes & Fosher represents investors nationwide and handles all cases on a contingency fee basis, meaning that you don’t pay any attorney fees if we do not collect for you.