Moloney Securities Co., a mid-sized broker-dealer based in suburban St. Louis, is currently facing significant scrutiny from state regulators and a wave of customer disputes. Recent filings reveal that the firm is navigating “dozens” of arbitration matters and inquiries from multiple state securities regulators, largely stemming from the sale of high-risk alternative investments.
For investors who purchased products like GWG Holdings L Bonds or GPB Capital through the firm, these developments raise serious questions about supervision and the suitability of recommendations.
If you or someone you know has suffered significant investment losses working with Moloney Securities or another brokerage firm, don’t hesitate to reach out to Meyer Wilson Werning today. Our attorneys are experienced in securities fraud cases and will help to guide you through the process with a free consultation to determine whether your losses are the result of actionable misconduct.
Inside the Moloney Securities Regulatory Inquiries
According to an audited annual financial statement filed with the Securities and Exchange Commission (SEC) on March 27, 2025, Moloney Securities (CRD#: 38535) is currently grappling with heightened regulatory attention. The firm disclosed that it is “addressing inquiries initiated by state securities regulators which are in varying phases.”
While the firm did not explicitly name the states involved or the specific reasons for every inquiry, the filing paints a picture of a brokerage under pressure:
- State Investigations: The firm admitted that some of these inquiries could be “resolved in the near future,” though the specific outcomes remain uncertain.
- Arbitration Volume: The report confirmed that the firm “is or was party to dozens of Finra customer arbitration matters.”
- Settlement Costs: Many of these disputes have already settled or are in the process of being settled, indicating a pattern of resolving claims rather than fighting them in prolonged litigation.
These disclosures suggest that Moloney Securities complaints are not isolated incidents but part of a broader trend affecting the firm’s roughly 125 retail registered representatives.
We Have Recovered Over
$350 Million for Our Clients Nationwide.
The SEC Settlement and Moloney Securities GWG Holdings Lawsuit Context
A major driver of the firm’s current legal troubles is its sale of GWG Holdings L Bonds, a high-risk alternative investment that left thousands of investors nationwide with significant losses after GWG declared bankruptcy in 2022.
In September, the SEC announced that it had reached a settlement with Moloney Securities and three of its advisors regarding violations of Regulation Best Interest (Reg BI). The regulators alleged that the firm failed to comply with care obligations when recommending these corporate bonds to retail customers between June 30, 2020, and January 15, 2022.
Breakdown of the Financial Penalties
The total penalties and payments connected to this settlement reached $437,900:
- Moloney Securities Co. agreed to pay a total of $316,900, comprising $58,700 in disgorgement, $8,200 in interest, and a civil penalty of $250,000.
- Three Financial Advisors collectively paid $121,000 in disgorgement, interest, and penalties to resolve the matter.
- No Admission of Guilt: As is common in these settlements, neither the firm nor the advisors admitted to or denied the SEC’s findings.
The Risks of GWG L Bonds
The SEC emphasized that GWG L Bonds were high-risk, complex products. During the relevant period, GWG’s own disclosures warned that investing involved a “high degree of risk,” including the potential loss of the “entire investment.” Despite this, approximately 40 broker-dealers sold close to $1.6 billion in these bonds over the last decade. Today, attorneys and executives fear these bonds may be valued at mere “pennies on the dollar.”
Previous Issues: GPB Capital Holdings
The Moloney Securities lawsuit history extends beyond GWG. The firm has also faced sanctions regarding its sale of GPB Capital Holdings, another alternative investment that plagued the industry.
At the end of 2022, Moloney Securities agreed to pay restitution of $268,000 to settle with the Financial Industry Regulatory Authority (FINRA). The settlement addressed allegations that the firm sold high-risk GPB securities to clients even while GPB Capital had failed to submit required audited financial statements.
This pattern—recommending high-risk, high-cost private investments that later face distress—is a central theme in the Moloney Securities regulatory inquiries and customer disputes.
How Meyer Wilson Werning Can Help Recover Your Investment Losses
The regulatory inquiries surrounding Moloney Securities and the collapse of high-risk investments like GWG Holdings highlight the serious risks investors face when firms fail to prioritize their clients’ best interests. If you suffered significant losses due to unsuitable recommendations or a lack of proper supervision, you may have grounds to recover your funds through arbitration—but strict time limits apply.
At Meyer Wilson Werning, our experienced securities fraud attorneys are prepared to review your portfolio, explain your legal options, and help you determine the best path toward financial recovery before the window to file a claim closes. Contact us today for a free, confidential consultation.
Frequently Asked Questions
What are the current regulatory issues facing Moloney Securities?
The firm disclosed in March 2025 that it is facing inquiries from multiple state securities regulators and is dealing with “dozens” of customer arbitration matters, many of which are related to high-risk alternative investments.
What was the result of the SEC settlement with Moloney Securities?
In September, the SEC reached a settlement with the firm and three advisors totaling $437,900. The firm paid a $250,000 fine plus restitution for failing to comply with Regulation Best Interest when selling GWG L Bonds.
Did Moloney Securities sell GWG Holdings L Bonds?
Yes. Regulators allege the firm recommended GWG L Bonds to retail customers between 2020 and 2022, despite the high risks involved. GWG declared bankruptcy in 2022, causing massive losses for investors.
How can I file a Moloney Securities complaint?
If you suffered losses, you should consult with a securities attorney. Most disputes are resolved through arbitration, where you can pursue a claim for damages against the firm for sales practice violations.
Recovering Losses Caused by Investment Misconduct.
