Woodbridge Wealth Files Chapter 11 Bankruptcy


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A ton of advisors in my area switched from FIA sales to this 5-7% guarantee one year term product. I have been speaking out against it at my seminars and on my newsletters since August. I even received a cease and desist letter from them as word got back that I was talking negatively about them. Monday they filed for Chapter 11 and missed the "income payments" due to the clients. Millions of dollars are at stake in my area, not sure how prevalent this is nationwide. The WSJ did a write up about the chapter 11 on Tuesday. Anyone else hearing anything about this?
Yea they are based out of California, but it's a huge marketing tool down here in FL. 6% guarantee ad's in the newspaper everyday.
Phew ! So glad I never sold these, although was sorely tempted as a struggling annuity agent. I even went down to their headquarters in Sherman Oaks, CA in early 2016 to hear their pitch and see their gleaming offices with dozens and dozens of chairs in the call center most of them were empty on the day that I went in)....I actually pitched it a few times, but my clients and prospects were smarter than me, thankfully !!
No doubt. Bunch of articles in the last day about the SEC charges. Here's an excerpt from the Miami Herald article (link below):

Woodbridge told investors it made its money by making short-term loans for 11 to 15 percent annual interest to third-party commercial property owners. Investors were promised a 5 to 10 percent interest return each year. But all but a few of the borrowing companies were owned by Shapiro, had no income and never paid interest on the loans. Old investors were kept from cashing out by Woodbridge’s claims of 90 percent client loyalty. About $64.5 million of investor money flowed as commissions to sales agents, who sold the investments as “conservative” and “low risk.”

“Despite receiving over one billion dollars in investor funds, Shapiro and his companies only generated approximately $13.7 million in interest income from truly unaffiliated third-party borrowers,” the complaint states. “Without real revenue to pay the monies due to investors, Shapiro resorted to fraud, using new investor money to pay the returns owed to existing investors. Meanwhile Shapiro and his family lived in the lap of luxury and spent exorbitant amounts of investor money in alarming fashion, on items such as luxury automobiles, jewelry, country club memberships, fine wine, and chartering private planes.”

The scheme collapsed earlier this month, the SEC said. A search of court records shows 12 companies carrying a Woodbridge name and now based in Sherman Oaks filed for Chapter 11 bankruptcy Dec. 4 in U.S. Bankruptcy Court in Delaware.

This Ponzi scheme moved $1.2 billion as it defrauded 8,400 investors, the SEC says
To everyone who is posting the bashing articles in the press regarding Woodbridge, be careful to throw the first stone because the press loves bad news. I personally spoke with the current restructuring manager of Woodbridge and he commented that Woodbridge and Shapiro are operating with "complete visability" with the bankruptcy court and hes been doing restructurings for 20 years and this "doesnt feel like a ponzi scheme"...The quotes are his, not mine....I would caution everyone to stay tuned on this case. You can't judge something like this just because the SEC has filed an investigation.
Furthermore why would Hankey Capital drop $100 MIL into restructuring this company if it were a Ponzi scheme? Can anyone answer that rhetorical question ?
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Please show me another case where an entity was accused of being a ponzi scheme... and it wasn't?

As far as your rhetorical question... could be some inside dealings going on. Anything is possible. But saying that "XYZ company just invested $$$ in it" is NOT a reason to "have faith". Lots of MLM companies talk like that in an effort to recruit (dupe) others. Wouldn't that be a "talking point" to keep their reps to continue to sell their offerings - if they could?

I'll wait for the results, but so far my mind is made up.
DHK - Hankey Capital is a Woodbridge - like investment (capital) company in Woodbridges backyard, Los Angeles. You think they are going to invest 100 MIL to bail out or prop up a ponzi scheme? This is all being done in front of the US bankruptcy court in Connecticut. How is that an inside dealing? Hankey wanted to invest in Woodbridge to keep it solvent. Invest 100 MIL to lose it ? Really? Woodbridge is still operating during the Chapter 11 proceedings. I dont think you have all of the facts.

Furthermore, the restructuring manager I quoted above is an accomplished corporate restructuring attorney DHK, so yes his legal opinion that "this doesnt feel like a ponzi scheme" holds water.

And currently during the bankruptcy proceedings, Woodbridge isn't continuing to offer thier short term bridge loan offerings so there isn't currently any more solicitation of new monies coming into the company.

Before you write, read more.

Oh and one more thing...Shapiro has been kept onboard during the restructuring proceedings before the court, and continues to be paid handsomely. If he was a criminal, why is he continuing to be paid by the new company taking over and not running and hiding?
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