brokerwatch

Alan Mason | Westpark Capital

According to FINRA’s Brokercheck, Alan Mason is a former registered representative of Westpark Capital who has faced two customer disputes since June 2022. These allegations relate, in part, to Alan Mason’s recommendation that a customer invest at least 20% of her liquid net worth in GWG L Bonds.

Alan Mason was registered with Westpark Capital from March 2018 to March 2023, before moving to Bradley Woods & Co., Ltd. According to BrokerCheck, the allegations include improper recommendations, failure to perform due diligence, unsuitability, and breach of fiduciary duty. One customer dispute appearing on Mason’s BrokerCheck alleges $5,000,000 in damages.

According to ThinkAdvisor, an Alan Mason client opened an individual account at WestPark where the client reported a moderate risk tolerance and a liquid net worth between $200,000 and $500,000. The customer’s stated investment objective was growth and income, and it did not include speculation. Nevertheless, Alan Mason recommended that the customer invest $100,000 in GWG L Bonds.

Other allegations include: 

• 2/23/2009: “Customer alleges unauthorized transactions and unsuitable transactions. Customer alleges these matters occurred from November 2008 through February 2009.” Settlement Amount: $25,000.00
• 5/21/2002: “[Customer] As trustee of her own trust alleges that AE Mason overly concentrated her portfolio with unsuitable, speculative securities.” Settlement Amount: $30,000.00
• 8/23/2000: “Failure to adhere to firm policy with respect to discretionary account procedures.” 
• 8/9/2000: “Customer [complains] of unauthorized trades which have no merit customer alleged transaction in 12/99, Jan/00, Feb/00 and Mar/00.” Settlement Amount: $50,000.00

Alan Mason | GWG L Bonds 

Broker-dealers like Westpark Capital have a duty to supervise the activities of its registered representatives like Alan Mason, including ensuring that customers are not recommended unsuitable securities. 

GWG is a publicly traded financial services company. Prior to 2018, GWG purchased life insurance policies through its subsidiaries on the secondary market. GWG continued topay the premiums for each policy that it purchased and collected the policy benefits upon the insured’s death. Following a series of transactions in 2018 and 2019 with Beneficient Company Group, L.P., GWG reoriented its business. stopped acquiring life insurance policies, and focused instead on developing a business model of providing liquidity to holders of illiquid investments and alternative assets. 

GWG had a history of net losses and had not generated sufficient operating and investing cash flows to fund its operations. To finance its operations, GWG offered corporate bonds (known as L Bonds) to investors with varying maturity periods and interest rates. L Bonds were not directly secured by GWG’s life insurance portfolio and were not rated by any bond rating agency.

GWG sold L Bonds to retail investors in four separate offerings and made those sales through a network of broker-dealers, including WestPark. which entered into an agreement with GWG to sell L Bonds in July 2016 and approved the product for sale by its registered representatives. The offering documents for the third and fourth L Bond offerings. which commenced in December 20 I7 and June 2020, respectively, stated the bonds could be considered speculative, involved a high degree of risk, were illiquid, and were only suitable for persons with substantial financial resources and with no need for liquidity. 

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