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SEC Alleges John Woods (Southport Capital) Ran “Horizon Private Equity” As A Massive Ponzi Scheme

SEC Alleges John Woods (Southport Capital) Ran "Horizon Private Equity" As A Massive Ponzi Scheme

The Securities Exchange Commission (SEC) claims Horizon Private Equity, III, is a “massive Ponzi scheme” and that investors owe $110M principal as of July 2021. John J. Woods. Woods worked at Southport Capital which is a d/b/a for Livingston Group Asset Management Company.  It is estimated that over 400 investors have lost money.

If you or someone you know invested with John Woods, please contact our experienced investment fraud attorneys immediately for a free consultation at 1-800-856-3352. Our national law firm has over 45 years of experience and a 95% success rate. We will provide a claim evaluation at no charge and provide you with any available options to recover your investment losses.  Please be aware there are laws and rules that may limit the amount of time that you have to file any claims and you should consult and experienced attorney regarding these matters.

We have experienced attorneys available and standing by to assist Horizon Private Equity investors in recovering their investment losses.

WHAT CAN WE DO TO HELP?

The Haselkorn & Thibaut, P.A. law firm’s goal is to put money back in the pockets of investors like you. Horizon and John Woods have been under investigation for several months. We are familiar with the Horizon Private Equity fund investments and the entities that sold it to investors. Our law firm is prepared to pursue claims on behalf of investors in arbitration and in court on behalf of investors nationwide to recover financial losses due to the misconduct of investment professionals. We are also investigating claims against various financial services firms that may have had direct or indirect involvement related to or associated with Horizon Private Equity.

WHAT DOES IT COST?

Our law firm typically handles these and similar matters on a contingency fee basis.  This means you are not throwing good money after bad to pursue these claims.  It means, if there is no recovery, there is no fee charged. We will not ask you to pay us anything out of your own pocket. Our law firm is prepared in most cases to advance some of the costs to initiate the claim(s). We are only paid a percentage of the recovery that we ultimately obtain for you.

What are the NEXT STEPS?

Contact our office today at 1-800-856-3352 and ask to schedule an appointment with one of our attorneys, or fill out an intake form and one of our attorneys will contact you. An experience investment fraud attorney will answer your questions, and discuss your specific situation and offer you options. A fast, friendly, initial evaluation will often take just a few minutes.

Horizon Private Equity – Background.

According to the SEC, the story began in 2008, when Woods was both registered as an investment advisor and a registered representative of a Southport Capital, a financial service firm. Woods was required to report any outside business activities to his employer. According to the Complaint, Woods solicited investors for Horizon and the company was “nominally controlled by Woods’ accountant” at that time to protect Woods’ real ownership.

Woods also bought Southport, an SEC-registered investment advisor, that same year. According to the Securities and Exchange Commission, Woods’ brother became “nominally” responsible for Southport while Woods remained in control of Southport. Woods’ cousin, who was also working at the same financial service firm as Woods, left shortly thereafter to join Southport. Woods resigned from Woods’ financial service firm in 2016 after questions were raised about Woods’ involvement with outside business activities. He then joined Southport full-time. According to the Complaint, Woods asked a business partner to not speak to his compliance personnel during the investigation into his Southport affiliation. He claimed that he had “only months to live” because of cancer.

Woods, his brother, and his cousin allegedly encouraged clients to invest in Horizon. They emphasized the safety and security of investments in Horizon and promised fixed and guaranteed returns. Investors rarely received any written information about a potential investment.

Instead, they relied on oral conversations and representations made either by Woods, Woods’ relatives, or other Southport advisors. Some investors were purportedly told that they could not lose their investment, that Horizon was not affiliated with Southport, that Horizon investments were an annuity and that funds from Horizon would be used for purchasing government bonds or collateralized mortgage obligations. Investors were also purportedly informed that Southport employees would receive no compensation for recommending Horizon investments.

Many of these and other representations that were made to investors were false or inaccurate. In reality, Woods operated Horizon as a Ponzi scheme that owes investors more than $110 million but has liquid assets of less than $16 million. Woods allegedly used new investor funds to pay existing investors, a hallmark of a classic Ponzi scheme and that scheme typically unwinds once the new investment dollars slow down or cease coming into the scheme. According to the SEC complaint, Horizon invested around $20 million in Horizon assets that would be difficult and time-consuming to liquidate.

The SEC Complaint further outlines that in 2018 the Commission’s Division of Examinations examined Southport, alleging that Woods misrepresented and controlled Horizon. Woods submitted written responses that indicated that he had “never” managed Horizon’s operations and that he wasn’t a signatory to Horizon’s checking account. It also stated that Woods was an investor in the fund but not a manager. In 2021, another examination was conducted, which allegedly resulted in Woods providing similar misleading responses.

In a hearing last week, U.S. District Judge Steven Grimburg agreed that the appointment of a receiver was warranted over Horizon but declined to do the same for Southport, reasoning that “I don’t find this burden has been satisfied at this juncture…” An attorney for Southport, while agreeing that a receiver was necessary for Woods and Horizon, cited the recent change in management and leadership at the firm and indicated that the company “will not be around for much longer” if a receiver was appointed over Southport.

We look forward to speaking with you and finding out the details of the representations or promises that were made to you specifically, and the exact timing and circumstances related to your investments.

 

 

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