Attorney Scott Silver was quoted in an article from Investment News regarding the recent bankruptcy filing by small business merchant service company 1st Global Capital, and a sister company, 1 West Capital.
Prior to the bankruptcy, the SEC and the US Attorney’s office in the Southern District of Florida opened similar investigations into the companies. Court documents indicate that the companies used “independent sales organizations, underwriters and other funding agents” to find and secure investors. Once the investigations began, the company could no longer raise capital, and filed for Chapter 11 bankruptcy to protect assets and continue the business. (Another company called 1st Global, located in Dallas, is unrelated.)
Mr. Silver notes that the 1st Global case is “eerily similar” to a prior case, a Ponzi scheme by a company called Woodbridge. That company was charged in December, as well as its founder, Robert Shapiro. That scheme was worth $1.2 billion, and targeted 8,400 investors. Mr. Silver sees 1st Capital as “following the Woodbridge model,” using unregistered brokers nationwide to sell to investors. It’s clear, Mr. Silver says, that investors, who are mostly mom-and-pop, will not be receiving any distributions. They’ve been left without the promised income, and wondering how much of their principal will be lost in the bankruptcy.
Mr. Silver has spoken to several creditors in 1st Global and 1 West. One of those was also a client of former broker Barry Kornfeld, who also sold sold millions of dollars’ worth of commercial mortgage loans issued by the Woodbridge Group. Kornfeld has since been barred from acting as a broker.
Wieniewitz Financial of Knoxville, Tennessee is listed as a registered investment advisor and a creditor in the bankruptcy proceedings and may have sold 1st Global investments to many retail investors.
Have You Invested With 1St Global Capital?
If you have investments with 1st Global Capital, call attorney Scott Silver to find out what your options are. Silver Law Group represents investors in securities and investment fraud cases. Our lawyers are admitted to practice in New York and Florida, and represent investors nationwide to help recover investment losses due to stockbroker misconduct and other investment-related wrongdoing. Most cases handled on a contingent fee basis. This means that you won’t any pay legal fees unless we are successful. Call us toll free at 800-975-4345, or use our online contact form to get in touch.