Case Study:
Warr Investment Group and Related Parties
Fraudulent Investment Scheme Stopped by Regulators
James Warr, through seventeen (17) affiliates entities was perpetrating an investment fraud on unsuspecting investors and was in the infancy of a Ponzi scheme when he was sued by the Texas Attorney General and the Texas State Securities Board for selling unregistered securities by unlicensed dealers and through various means of fraud.
The Solution
The Texas Attorney General filed a lawsuit in State District Court to have the entities placed into receivership
Harney's Greg Milligan was appointed as State Court Receiver.
An orderly wind down was completed for the assets of each entity.
A forensic investigation was conducted to identify affected investors, the source and use of investor funds, the location and liquidation of all recoverable assets.
The Receiver also developed an equitable claims and distribution process that was approved by the Court.
The Results
After the recovery and liquidation of all available assets, investors received a dividend of 44.4% on their investment claims, which is well above the national average for Ponzi scheme recoveries.
Milligan provided his investigative findings to the State Board of Securities and testified at the criminal trial of the companies’ principal, James Warr, resulting in a conviction on four first-degree felony counts of theft, securities fraud, money laundering, and misapplication of fiduciary property.
Mr. Warr was sentenced to 15 years in prison.
Services & Roles
Fiduciary Services
State Court Receiver
Forensic Accounting
Fraud Investigation
Liquidation/Wind Down
*Some engagements may have been performed by team prior to joining Harney Partners.
