Investor Lawyers Blog
As we discussed in a recent blog post, a $283 million Chapter 11 bankruptcy filing on July 27, 2018, by the Hallandale Beach, FL firm 1 Global Capital (a/k/a 1st Global Capital, or 1GC) has negatively impacted investors nationwide. Unfortunately, many retail investors committed their hard-earned money, in many instances their retirement funds, into so-called 1GC “memorandums of indebtedness” which were also sometimes referred to as First Global Capital Notes (“Notes”). Publicly available records indicate there are more than 4,000 1GC accounts across the country, sold by many advisors in various states.
Formed approximately 5 years ago, 1GC was purportedly in the business of financing small business by providing capital to a range of businesses including restaurants, construction companies, manufacturing operations, and healthcare companies. 1GC issued its Notes to retail investors, often referred to in the contract as “lenders” or in other instances as “creditors.” In exchange, these lenders or creditors invested in supposedly safe, short-term deals that would pay out around 7% in interest at the end of the term (e.g., 9-month term).
Upon information and belief, a number of 1GC investors were steered into these Notes by advisors. Advisors who have recommended Notes reportedly may include Matthew Walker or others working for his Overland Park, Kansas-based group of Pinnacle Plus companies.