Were you the victim of the Horizon Private Equity Ponzi Scheme and former Oppenheimer & Co., Inc. Broker John Woods (CRD# 1949233)? Erez Law is currently investigating Oppenheimer & Co., Inc. for its role in enabling a massive $110 million Ponzi scheme, “Horizon Private Equity,” orchestrated by a Georgia resident and former Oppenheimer registered representative, John Woods. It is alleged that more than 400 investors in 20 states have been victims of the Ponzi Scheme, which is said to be ongoing and continues to raise money from new investors monthly. If you were an Oppenheimer & Co., Inc. customer and invested in Horizon Private Equity, we are interested in speaking with you confidentially.
Timeline of the Horizon Private Equity Ponzi Scheme
Previously, John Woods was registered with Oppenheimer & Co., Inc. in Atlanta, Georgia, from 2003 to 2016. Southport Capital is an investment advisory firm that Woods was the President and majority owner of until he was terminated in August 2021 after it became known he was being investigated for an alleged Ponzi scheme.
In August 2021, the U.S. Securities and Exchange Commission (SEC) filed an emergency action to stop a Ponzi scheme allegedly perpetrated by John Woods and the two entities he controls: Livingston Group Asset Management Company (Southport), and Horizon Private Equity, III LLC (Horizon). The SEC’s complaint charges Woods and his companies with violating the anti-fraud provisions of the federal securities laws. According to the action, the complaint seeks preliminary and permanent injunctions, disgorgement, prejudgment interest, civil penalties, an asset freeze, and the appointment of a receiver.
In August 2021, the SEC opened an investigation into John Woods for an alleged Ponzi scheme that has been operating for over a decade. According to the SEC complaint, “Many of the victims are elderly retirees who were preyed upon by investment advisers at Southport, a registered investment advisory firm owned and controlled by Woods… Woods and his cohorts at Southport generally told investors that Horizon would earn a return by investing their money in, for example, government bonds, stocks, or small real estate projects; investors were not told that their money would or could be used to pay returns to earlier investors. But that is exactly what the Defendants did; they were only able to pay the guaranteed returns to existing investors by raising and using new investor money. Horizon has not earned any significant profits from legitimate investments; instead, a substantial percentage of purported “returns” to earlier investors were simply paid out of new investor money. The assets owned by Woods and the entities under his control, including Southport and Horizon, are worth far too little for there to be any realistic prospect that the Ponzi scheme will be able to pay back existing investors their principal, let alone the promised returns. Because the scheme has been going on for so long and because Woods, Southport, and Horizon did not use any of the typical recordkeeping practices one would expect from a legitimate investment fund, millions of dollars worth of investor funds are currently unaccounted for.”
In June 2022, the SEC filed civil fraud charges against Michael Mooney, Britt Wright, and Penny Flippen as co-conspirators for their role in the Ponzi scheme fraud. According to the SEC, Mooney, Wright, and Flippen were investment advisors in Sarasota, Florida, and Mount Airy, North Carolina, who sold Horizon to investors.
In September 2022, a FINRA arbitration panel ordered Oppenheimer & Co., Inc. to pay $36.7 million to 10 harmed investors related to their involvement in the Horizon Private Equity II Ponzi Scheme, which included $5.7 million in compensatory damages, $11.4 million in punitive damages, $14.1 million in RICO damages, $98,655.96 in costs, and $5.3 million in lawyers’ fees.
According to the award, the claimants asserted the following:
- Violations of FINRA Rules
- Negligence
- Breach of fiduciary duty
- Violation of the Georgia RICO statute
- Breach of contract
The investors initially sought $6 million in compensatory damages, RICO damages in an amount three times the actual damages sustained, punitive damages, attorneys’ fees and costs of investigation and litigation, pre-judgment interest, and costs.
On March 24, 2023, John Woods, President of Southport Capital and manager of Horizon Private Equity, III, LLC, pleaded guilty to operating a Ponzi scheme.
How Did the Scheme Work? Whom Did It Target?
The scheme was allegedly orchestrated through John Woods’ firm, Southport Capital, between 2008 and 2016. It is alleged that elderly investors were targeted for this scheme. According to online records, Horizon Private Equity does not have offices or employees. All activities have been conducted by Woods and the employees of Southport.
Additionally, it is alleged that John Woods and other investment adviser representatives at Southport Capital, including John Woods’ brother Jim Woods, told clients that they would receive returns of 6-7% interest, guaranteed for two to three years, for investments in “Horizon Private Equity.”
According to the SEC, Woods, Southport, and other Southport investment adviser representatives allegedly told investors the following:
- Their Horizon investments were safe
- Their investments would be used for different investment activities
- They would pay a fixed rate of return
- Investors would be able to get their principal back without any penalty after a short waiting period elapsed
The SEC says these assurances were patently false and misleading. According to the SEC, Horizon failed to earn significant profits from legitimate investment activities. Additionally, many returns to earlier investors were paid out by infusions of cash from new investors, symbolic of a traditional Ponzi scheme. The SEC complaint also alleges that Woods lied to the SEC repeatedly while it was completing its regulatory examinations of Southport.
According to public records, Woods and his cohorts did not tell investors that their investment would be used to pay returns to earlier investors in a Ponzi-like manner.
Erez Law Files Complaint Against Oppenheimer & Co., Inc.
Erez Law has filed multiple FINRA arbitration cases against Oppenheimer & Co., Inc., related to its involvement in the alleged Ponzi scheme. In one case, the Erez Law clients, some of 400 victims of the alleged fraudulent scheme, allege that John Woods solicited the couple to invest over $1 million of their irreplaceable savings in Horizon Private Equity II. Regrettably, for the clients, the investments in Horizon Private Equity II are now worthless as the investment has been publicly exposed as a Ponzi scheme and John Woods and his co-conspirators have been charged with fraud by the SEC. It is alleged that John Woods represented that Horizon Private Equity II was a safe investment that had never missed a dividend payment and would preserve the principal while generating a consistent return, which the clients could use to meet their income needs in retirement. Erez Law alleges that John Woods also solicited the clients to invest in Horizon Private Equity II by making false and misleading representations.
Investors did not learn of John Woods’ fraud or their catastrophic financial losses until after August 2021, when the SEC filed fraud charges against him and Horizon Private Equity II. According to the claim, the clients have lost all of their principal invested in Horizon Private Equity II. It is alleged that Oppenheimer & Co., Inc. failed to satisfy its basic supervisory obligations and the clients and hundreds of other unsuspecting victims have suffered devastating losses as a result.
The Receiver is Unable to Recover and Disburse All Funds to Investors
Although a receiver has been appointed, the receiver will not be able to recover the funds necessary to reimburse all the investors for their losses in the Ponzi scheme. On January 24, 2023, Judge Grimberg approved the distribution of $18,000,000. This amount falls significantly short of the money due to investors.
John Woods Customer Complaints
John Woods has been the subject of 32 customer complaints between 2008 and 2022, one of which was denied, according to his CRD report. Recent complaints are regarding:
November 2022. “Claimants allege John Woods, James Woods, Michael Mooney, Iris Israel, and Julie Jones conducted a Ponzi scheme. From 2003 to 2016.” The customer sought $300,000 in damages in this pending complaint.
September 2022. “Claimants allege John Woods, James Woods, Michael Mooney, and Iris Israel conducted a Ponzi scheme. From 2003 – 2016.” The customer sought $900,000 in damages in this pending complaint.
September 2022. “Claimants allege John Woods, James Woods, Michael Mooney, Iris Israel, and Julie Jones conducted a Ponzi scheme. From 2003 – 2016.” The customer sought $1,000,000 in damages in this pending complaint.
August 2022. “Claimant alleges that John Woods, James Woods, Michael Mooney, Iris Israel, and Julie Jones conducted a Ponzi scheme. From 2007 – 2021.” The customer sought $104,100 in damages in this pending complaint.
July 2022. “Claimants allege John Woods, James Woods, Michael Mooney, and Iris Israel conducted a Ponzi scheme. 2003 – 2016.” The customer sought $2,000,000 in damages in this pending complaint.
April 2022. “Claimants allege John Woods, James Woods, Michael Mooney, Iris Israel, and Julie Jones conducted a Ponzi scheme. From 2013 – 2021.” The customer sought $1,372,000 in damages in this pending complaint.
April 2022. “Claimant alleges John Woods and Michael Mooney conducted a Ponzi scheme. From 2008 – 2021.” The customer sought $170,000 in damages in this pending complaint.
April 2022. “Claimants allege John Woods, James Woods, and Michael Mooney conducted a Ponzi scheme. From 2012 – 2021.” The customer sought $1,000,000 in damages in this pending complaint.
April 2022. “Claimant alleges that John Woods and Michael Mooney conducted a Ponzi scheme. From 2008 – 2021.” The customer sought $170,000 in damages in this pending complaint.
April 2022. “Claimant alleges that John Woods, James Woods, Michael Mooney, Iris Israel, and Julie Jones conducted a Ponzi scheme. From 2014 – 2021.” The customer sought $288,000 in damages in this pending complaint.
March 2022. “Claimants allege that John Woods, James Woods, Michael Mooney, and Iris Israel conducted a Ponzi scheme. From 2012 – 2021.” The customer sought $3,000,000 in damages in this pending complaint.
March 2022. “Claimant alleges John Woods, James Woods, Michael Mooney, Iris Israel, and Julie Jones conducted a Ponzi scheme. From 2013 – 2020.” The customer sought $394,200 in damages in this pending complaint.
March 2022. “Claimants allege that John Woods, James Woods, Michael Mooney, and Iris Israel conducted a Ponzi scheme. From 2012 – 2021.” The customer sought $4,000,000 in damages in this pending complaint.
March 2022. “Claimants allege that John Woods, James Woods, Michael Mooney, and Iris Israel conducted a Ponzi scheme. From 2014 – 2016.” The customer sought $1,200,000 in damages in this pending complaint.
February 2022. “Claimant alleges that John J. Woods, Michael Jeremiah Mooney, and James Wallace Woods conducted a Ponzi scheme. From 2008 to 2021.” The customer sought $300,000 in damages in this pending complaint.
January 2022. “Claimant alleges that former employees John Woods and Michael Mooney conducted a Ponzi scheme from 2008 – 2016 (at Oppenheimer).” The customer sought $942,126 in damages in this pending complaint.
January 2022. “Former employees John Woods, Michael Mooney, and Iris Israel allegedly conducted a Ponzi scheme. From 2005 – 2016 (at Oppenheimer).” The customer sought $1,000,000 in damages in this pending complaint.
December 2021. “Former FAs John Woods, James Woods, and Michael Mooney, with the involvement of Iris Israel and Julie Jones, allegedly conducted a Ponzi scheme. From 2005 – 2016 (at Oppenheimer).” The customer sought $5,000,000 in damages in this pending complaint.
December 2021. “Former FAs John Woods, James Woods, and Michael Mooney allegedly conducted a Ponzi scheme from 2007 until December 2016. From 2015 – December 2016 (at OPCO, allegedly until 2021 post-OPCO).” The customer sought $470,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods, James Woods, Michael Mooney, and Iris Israel allegedly conducted a Ponzi Scheme from 2007 until December 2016. From 2012 – 2016.” The customer sought $2,500,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods, James Woods, Michael Mooney, Arthur Brown, Iris Israel, and Julie Jones allegedly conducted a Ponzi Scheme from 2007 until December 2016. Time period from 2013 – 2020.” The customer sought $510,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods, James Woods, Michael Mooney, and Iris Israel allegedly conducted a Ponzi Scheme from 2007 until December 2016. Time period from 2012 – 2016.” The customer sought $1,000,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods and Michael Mooney allegedly conducted a Ponzi scheme from 2007 until December 2016. From 2008 – 2016.” The customer sought $700,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods, James Woods, Michael Mooney, and Iris Israel allegedly conducted a Ponzi scheme from 2007 until December 2016. From 2008 – 2016.” The customer sought $3,300,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods, James Woods, Michael Mooney, and Iris Israel allegedly conducted a Ponzi scheme from 2007 until December 2016. March 2012 – September 2015.” The customer sought $3,300,000 in damages in this pending complaint.
November 2021. “Clients’ attorney alleges misconduct, negligence, and breach of fiduciary duty. No time period specified, but subject accounts opened during 2012 and left the firm in 2016.” The customer sought $1,500,000 in damages in this pending complaint.
November 2021. “Former FAs John Woods, James Woods, Michael Mooney, Arthur Brown, Iris Israel, and Julie Jones allegedly conducted a Ponzi Scheme from 2007 until December 2016. March 2012 – September 2015.” The customer is seeking $1,200,000 in damages in this pending complaint.
September 2021. “Former FAs John Woods, James Woods, and Michael Mooney allegedly conducted a Ponzi Scheme from 2007 until December 2016. Time period – 2009 – 2016.” The customer is seeking $3,800,000 in damages in this pending complaint.
September 2021. “Former FAs John Woods, James Woods, and Michael Mooney allegedly conducted a Ponzi Scheme from 2007 until December 2016. Time period – 2009 – 2016.” The customer is seeking $1,800,000 in damages.
September 2021. “Former FAs John Woods, James Woods, and Michael Mooney allegedly conducted a Ponzi scheme from 2007 until December 2016. From 2/1/2014 – 6/30/2016.” The customer sought $1,400,000 in damages, and the complaint was settled for $36,745,076.26.
August 2021. “Former FAs John Woods, James Woods, and Michael Mooney, allegedly conducted a Ponzi scheme from 2007 until December 2016. From 2/1/2014 – 6/30/2016.” The customer is seeking $170,000 in damages.
It is alleged that the following advisers who were registered with Southport Capital recommended Horizon Private Equity:
- Michael Mooney
- Jim Woods
- Arthur Brown
- Penny Flippen
- Britt Wright
Are You a Victim? Contact a Lawyer for the Horizon Private Equity Ponzi Scheme
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If you have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations, and institutions in claims against brokerage firms, banks, and insurance companies on a contingency fee basis.