John J. is the receiver in the Ponzi scheme. Woods will deal with the liquidated assets of the case as soon as possible, including more $ 55 million in entities located in the Chattanooga region.
However, the receiver stated in court papers that it was not known how long it would take to sell assets and distribute the funds to the more than 400 investors who were allegedly billed under the scheme.
A. Cotten Wright was appointed North Carolina’s attorney to act as a receiver. She stated in her first quarterly report to a federal court overseeing the U.S Securities and Exchange Commission action against Woods that she does not know if there are any net winners.
Federal regulators in August charged Woods with running a Ponzi scheme that defrauded investors for more than a decade.
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According to the complaint, the scheme, which is modeled on Horizon Private Equity, raised more than $110 million from investors and promised 6-7% returns.
The complaint stated that the investment are far too small to be really able to repay the principal to existing investors.
Six securities frauds were charged by the SEC against Woods, de Marietta and Georgia as well as Southport Capital, a Chattanooga-based investor firm.
The receiver created a website about the case that indicated it was “very likely” investors would get their entire principal investment back. The receiver stated that it will do everything possible to maximize the amount it can give back to investors.
The website stated that the receiver would liquidate Horizon’s assets and ensure as much investor money as possible.
David Chaiken, Woods Atlanta attorney, stated that “SEC allegations only one side” of the story.
“We look forward to presenting Mr. Woods’ side in court through the judicial procedure,” Chaiken stated.
Woods, a native of East Ridge, was heavily involved in Chattanooga entities. These included the Chattanooga Lookouts minor baseball team and real estate ventures that included strip centers and former Sears and Penney shops at Northgate Mall.
The receiver stated that Woods also owned a 66% stake in Livingston Group Asset Management. This is the same company that runs Southport Capital, an investment advisory firm with a $ 34 million budget.
Woods had invested in 13 ventures in Chattanooga, Fort Oglethorpe, and other areas, according to the receiver, for $21.2 million.
Already, the receiver asked U.S. District Judge Steven J. Grimberg for approval of Chattanooga Lookouts’ application to purchase the Woods-owned portion of staff for $ 1.87million. According to court papers, Woods owned a 20.1% stake in the team.
Woods’ assets also include $ 14.9million in cash. The receiver stated that it is currently reviewing and considering potential claims. She said she would propose a claim allowance, deadline, and distribution procedure for court approval “at the appropriate time”.
Wright stated that distributions will be made under court authority.
She has established a dedicated telephone line to receive calls from Horizon investors. These calls come in daily, the receiver said. Wright stated that he also created an email address for the receivership in order to communicate with investors.