Nashville B-D that sold GWG bonds closing down

investmentnews.com:

Center Street Securities Inc., a broker-dealer in Nashville that opened its doors more than 30 years ago, is shutting down.

The broker-dealer, which sold bonds backed by the bankrupt GWG Holdings Inc., informed the Financial Industry Regulatory Authority Inc. on Tuesday that it was filing its termination notice, called a form BDW in industry parlance, for “broker-dealer withdrawal,” according to the firm’s BrokerCheck report.

Center Street was a relatively small brokerage firm, with just $336 million in advisory assets, according to its latest Form ADV. It is at least the third firm this year that sold GWG bonds that has gone out of business, following Arque Capital Ltd. of Scottsdale, Arizona, over the summer, and JRL Capital Corp., a small broker-dealer based in Irvine, California, which also sold the defunct GWG bonds. JRL filed for Chapter 7 bankruptcy in May.

Donald Pollard, CEO of Center Street, declined to comment Thursday afternoon on the matter.

Center Street Securities is owned by Center Street Holdings Inc., a holding company owned by Arete Wealth Inc., another holding company. In turn, Arete Wealth Inc. also owns another broker-dealer, Arete Wealth Management, but the two firms had separate operations and were not merged.

A spokesperson for Arete also declined to comment.

About 40 broker-dealers over the past decade sold close to $1.6 billion of GWG L bonds, so-called because they were backed by life settlements, before the firm declared bankruptcy last year, leaving firms like Center Street and their clients in the lurch. It’s not clear what value, if any, the GWG bonds have.

And it appears that Center Street was facing a costly legal battle due to a failure of a product, likely GWG bonds. In a filing