by Structured Settlement Watchdog
JG Wentworth and its co-defendants possessed material nonpublic information regarding JG Wentworth's business, unknown to plaintiff Walter Jones, when they sold JG Wentworth stock to Jones, and misrepresented, concealed and omitted material facts regarding JG Wentworth's business in order to induce Jones to agree to close the sale and acquisition of Westar Mortgage, Inc. to JG Wentworth five days before JG Wentworth's earnings announcement on August 5, 2015. 25% of the consideration paid to Jones was in JG Wentworth stock (then symbol JGW and listed on the New York Stock Exchange). The decision to pay 25% of the consideration in JGW stock was made 3 days before the closing date, according to the Complaint.
During its quarterly earnings call the next day , JGW officers and employees revealed knowledge of material non-public information they knew but failed to disclose to Jones prior to the sale of JGW stock to Jones and the closing of the Transaction . Following the quarterly earnings announcement , the value of JGW’s stock declined sharply, eventually rendering all but worthless 25% of the agreed-to consideration paid by JGW to Jones and the other purchasers of JGW stock for their WestStar stock.
JGW stock then continued to plummet to the point where it was delisted from the NYSE in June 2016. The mortgage business acquired from WestStar is the most profitable business that JGWE currently has.
JG Wentworth is a member of the National Association of Settlement Purchasers (NASP) and the largest buyer of structured settlement payment rights.
Read the JG Wentworth Fraud lawsuit Complaint in Walter F. Jones b The JG Wentworth Company and Stewart Stockdale SDNY 1:16 cv 10018JSR
The matter was voluntarily dismissed in February 2017.