Moloney Securities Co. Consent Order for GWG L Bond Sales

STATE OF NEW HAMPSHIRE DEPARTMENT OF STATE BUREAU OF SECURITIES REGULATION CAPITOL STREET CONCORD, NEW HAMPSHIRE 03301 CO~SE~T ORDER IN THE MATTER o•·: Moloney Securities Co., Inc. (CRD #38535) Glenn Cray (CRD #5184058} Robert Gustafson (CRD #57S3473) 1-2024000017 For purposes ofsettling the above-referenced matter and in lieu offurther administrative proceedings, Moloney Securities Co., Inc. (hereinafter "Moloney"), Glenn Cray, and Robert Gustafson (together, Cray and Gustafson, hereinafter the "Moloney Agents") (the three collectively hereinaf\er the "Respondents"), have submitted an oITer ofsettlement, which the State ofNew Hampshire, Department ofState, Bureau ofSecurities Regulation (the "Bureau"), has determined to accept. Respondents neither admit nor deny the statements offacts and allegations set forth below, agree lo the undertakings and sanctions as set forth below, and consent to the entry ofthis Consent Order {the .. Order") by the Bureau, thereby settling the above-captioned matter in its entirety. This Order is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provision ofthe New Hampshire Uniform Securities Act (the "Act"), N. H. Rev. Stat Ann. § 421-B. ST A TEMENTS OF FACT I. The Bureau makes the following statements of fact: I. Moloney is incorporated in the State of Missouri and has a principal place of business at 1353 7 Barrett Parkway Drive, #300, Manchester. MO 63021. Moloney is a licensed broker-dealer in all fifty states including New Hampshire and a member of FINRA operating under CRD #38535. 2. Moloney has had a registered branch office location in Epping. NH (the "Epping Branch"} since November 11, 2015 under the branch CRD #620458. The branch location was originally opened and registered under J.P. Turner & Company, L.L.C. (CRD #43177) in June of2012 but was eventually acquired by Moloney. During all relevant times, the Moloney Agents worked at this location. 3. Glenn Cray has been registered in New Hampshire as an agent ofa broker-dealer and an agent ofan investment advisor since February 28, 2007. Glenn Cray filed an initial Page I of8

U4 with FINRA on September 22, 2006 and has been operating under CRD #5184058. 4. Robert Gustafson has been registered in New Hampshire as an agent ofa broker- dealer and an agent ofan investment advisor since March 22, 2010. Robert Gustafson filed an initial U4 with FIN RA on February I, 20 IO and has been operating under CRD #5753473. 5. GWG Holdings, Inc. ("GWG") was a company originally based out ofMinneapolis, MN (later. Dallas, TX) whose business strategy consisted ofbuying life insurance policies on the secondary market, paying the premiums on those policies. and then receiving the policy benefit when the policies matured. GWG sold securities products on the public market ("GWG Products"), the most popular being L Bonds (originally named Renewable Secured Debentures). from January 31, 2012 until January I 0, 2022. GWG declared Chapter bankruptcy on April 20, 2022 and dissolved on August 1, 2023; all assets were transferred to liquidating trusts in accordance with its bankruptcy proceedings. 6. L Bonds were debt instruments issued by GWG thal had 6-month, I-year. 2-year, 3- year, 5-year, and 7-year maturity dates depending on the issuance. L Bonds provided for interest rates of between 4.75% to 9.50% depending on the issuance and maturity date ofthe bond. L Bonds were secured by all assets ofGWG; however, and importantly, the bulk ofGWG's assets- a majority of the life insurance policies- were used as collateral for its senior credit facility. GWG failed to pay interest rates on L Bonds on January 15, 2022 prior to declaring bankruptcy. By the time it declared bankruptcy. GWG had over $1 .6 billion in outstanding L Bonds. 7. In 2023. during a separate im•estigation into GWG. the Bureau learned that Moloney had recommended and sold at least one hundred sixty-one ( 161) GWG Products to customers out of the Epping Branch between May 1, 2013 and May I, 2021. 8. In the prospectus ofone ofGWG's L Bond offerings, GWG stated that .. [a]n investment in the L Bonds involves significant risks, including the risk of losing your entire investment, and may be considered speculative."' The other GWG Products were junior to L Bonds and thus, even less likely to be paid back to investors in the event ofa bankruptcy. 9. The Bureau reviewed the customer-account investment objectives and risk tolerances ofthe Epping Branch customers in order to examine the customers' stated objectives and risk tolerances. The Bureau alleged that the objectives and risk tolerances ofthe customers that purchased GWG Products did not comport with the Moloney Agents' recommendations ofthose products. GWG Holdings, Inc., Prospectus, Form 42481, (Dec. I. 2017) nt 9. hUps;f!www.scc .go\·/Archivcs/cdgarfdata/ 152269010001213900170 I 3 I I 31 1~24b1121117 _gwgholdings.hlm. of

1. The Bureau alleges a company-wide misunderstanding ofGWG Products and asserts that neither the Moloney Agents nor the supervisors at Moloney headquarters in Missouri understood the collateral used to secure the products. The Bureau alleges that since the Moloney Agents did not understand how GWG Products were secured, they could not properly assess the risk level of the products. Similarly, the Bureau alleges that the supervisors at Moloney headquarters also did not understand the collateral; therefore. they could not properly review the suitability ofthe recommendations and sales ofGWG Products made by the Moloney Agents. 11. According to the GWG Bankruptcy Trust, GWG owed New Hampshire residents over $2.5 million in principal and interest payments arising directly from the sales recommended by Respondents. Moloney and the Moloney Agents made commissions on the recommendation and sale of GWG Products. ST A TEMENTS OF LAW I(. The Bureau makes the following statements of law under N.H. RSA § 421-8: I. Moloney and the Moloney Agents meet the definition of"Person" pursuant to RSA 421-B: 1-102(39). 2. Moloney is a ·•Broker-dealer" pursuant to RSA 421-8: 1-102(6). 3. The Moloney Agents meet the definition of"Agcnt'' pursuant to RSA 421-B:1- 102(3). 4. Moloney· s office in Epping, NH is a "Branch office·• pursuant to RSA 421-B: 1- 102(5)(A)(ii). 5. Pursuant to RSA 42 I-B:5-50l(b)( I), "a broker-dealer or broker-dealer agent must have reasonable grounds for believing that the recommendation is suitable for the customers upon the basis ofthe facts." The Bureau detem1ined that the Moloney Agents violated this section because they did not understand the products, and, therefore, the Moloney Agents could not properly assess the suitability ofGWG Products for their customers. 6. Pursuant to RSA 42 I-B:4-412(d)(9), the secretary ofstate may take disciplinary action ifa broker-dealer "has failed to reasonably supervise an agent . . . ifthe agent . . . was subject to the person's supervision and committed a violation ofthis chapter." The Bureau detennined that Moloney violated this section because its supervisors did not understand GWG Products, and, therefore. Moloney could not properly supervise the recommendations and sales ofGWG Products made by the Moloney Agents. 7. Pursuant to RSA l-B:6-604(a)( I), ifthe secretary of state has detennincd that a person has engaged in a violation ofthe Act. "the secretary ofstate may issue an of order directing the person to cease and desist from engaging in the act, practice, or course of business." Moloney and the Moloney Agents are subject to this provision. 8. Pursuant to RSA 42 l-B:6-604(d), "the secretary ofstate may impose a civil penalty up to a maximum of$2.500 for a single violation." Moloney and the Moloney Agents arc subject to this provision. 9. Pursuant to RSA 42 I-B:6-604(e), "the secretary of state may enter an order of rescission, restitution, or disgorgcmcnt." Moloney and the Moloney Agents arc subject to an order ofdisgorgement and restitution stated in this provision. l0. Pursuant to RSA 42 l-B:6-604(g), "the secretary of state may charge the actual cost of an investigation or proceeding for a violation ofthis chapter." Moloney and the Moloney Agents arc subject to this provision. UNDERTAKINGS UI. Based on the foregoing, Respondents agree to the following undertakings and sanctions: I. R~pondcnts agree that they voluntarily consented to the entry ofthis Consent Order and represent and aver that no employee or representative ofthe Bureau has made any promise, representation. or threat to induce their execution. 2. Respondents agree to waive their right to an administrative hearing and any appeal thereof under RSA 421-B. 3. Moloney has represented to the Bureau that it cannot pay restitution above the amounts prescribed in this Consent Order, and that it has ceased operations. As such, Moloney submitted a Uniform Request for Broker-Dealer Withdrawal ("Form BOW") with FINRA on December 9, 2025 to withdraw its registration. 4. By execution ofthis Consent Order by Moloney, Moloney agrees to pay or to cause to be paid restitution in the amount of one hundred thousand dollars ($100,000) to customers who incurred losses after being recommended and sold GWG Products by the Moloney Agents (the "Affected Customers''). Moloney shall pay restitution to the Affected Customers on a pro-rata basis based on the amount ofprincipal lost minus interest received from GWG during the lifespan of the investment. Moloney shall provide restitution in the fonn ofa check to the Affected Customers within forty-five (45) days ofthe execution of this Consent Order. Ifany restitution check is undeliverable for any reason after forty-five ( 45) days, Moloney shall provide the Bureau with the last known contact information ofthe customer in question and provide the Bureau a reasonable period of time to locate the customer or the customer's heir, issue, or assigns ifapplicable, contact the customer (or the customer's heir, issue, or assigns, if applicable), and to forward updated contact information to Moloney. Upon receipt of updated client and/or other payee contact Page of8

infonnation, Moloney shall make reasonable efforts to ensure that any such retunds are sent to the new address. Ifthe customer (or the customer's heir. issue, or assigns, ifapplicable} cannot be found by both Moloney and the Bureau after reasonable efforts arc made, the restitution fonds will eschcat to the State, and Moloney will issue a check for the appropriate amount made out to the State ofNew Hampshire. 5. Moloney also agrees to pay or to cause to be paid the cost of the Bureau's investigation in of fourteen thousand dollars ($14,000). Payment shall be made upon execution of this Consent Order and shall be: I) made by United States postal money order, certified check, bank cashier's check, or bank money order; 2) made payable to the State ofNew Hampshire; and 3) hand-delivered or mailed lo the Bureau ofSecurities Regulation, Department ofState, State I-louse, Room 204, I 07 North Main Street, Concord, New Hampshire, 0330 l. 6. Upon execution of this Consent Order by Glenn Cray, Glenn Cray agrees to pay disgorgement related lo the commissions earned on recommending GWG Products in of fifteen thousand dollars ($15,000) over two years in roughly equal quarterly installments, the first of which will be paid on or before March 31, 2026. Payment shall be: I) made by United States postal money order, certified check, bank cashier's check, or bank money order; 2) made payable to the State of New Hampshire; and 3) hand-delivered or mailed to the Bureau ofSecurities Regulation, Department of State, Stale House, Room 204, I 07 North Main Street, Concord, New Hampshire. 0330 I. 7. Upon execution of this Consent Order by Robert Gustafson. Robert Gustafson agrees to pay disgorgcment related to the commissions earned on recommending GWG Products in lhc amount of thirty-five thousand dollars ($35,000) over two years in roughly equal quarterly installments, the first ofwhich will be paid on or before March 31, 2026. Payment shall be: I) made by United States postal money order, certified check, bank cashier's check, or bank money order; 2) made payable to the State of New Hampshire; and 3) hand-delivered or mailed to the Bureau of Securities Regulation, Department ofState, State House, Room 204, I 07 North Main Street, Concord, Ne\1,' Hampshire, 03301. 8. By execution ofthis Consent Order by Glenn Cray, Glenn Cray agrees to one (I) year ofheightened supervision by any fim1 with which he is associated, employed, or an agent thereof. other than Moloney, on tenns not unacceptable to the Bureau. 9. By execution ofthis Consent Order by Robert Gustafson, Robert Gustafson agrees to one (I) year of heightened supervision by any firm with which he is associated, employed, or an agent thereof, other than Moloney, on tenns not unacceptable to the Bureau. I 0. Respondents agree that this Order is entered into for purpose of resolving only the matter as described herein. This Order shall have no collateral esloppel, res judicala Page S of

or evidentiary effect in any other lawsuit, proceeding, or action not described herein. Likewise. this Order shall not be construed to restrict the Bureau's right to initiate an administrative investigation or proceeding relative to conduct by Respondent which the Bureau has no knowledge at the time ofthe date or final entry of this Order. 11. Respondents may not take any action or make or pcnuit to be made any public statement including in regulatory filings or otherwise, denying, directly or indirectly, any allegation in this Order or creating the impression that the Order is without factual basis. Nothing in this provision affects Respondent's testimonial obligations or right to take legal positions in an investigation or litigation in which the Bureau is not a party. 12. Moloney and the Moloney Agents agree to pennanently cease and desist from further violations of RSA 42 l-B:4-4 I2(d)(9) and RSA 421-B:5-50 I (b )(I}, respectively. 13. This Consent Order is not intended to indicate that Respondents should be subject to any statutory disqualifications set fo11h in (a) the federal securities laws or regulations promulgated thereunder, (b) the rules and regulations of any self-regulatory organization, or (c) various states' securities laws. including any disqualifications from relying on exemptions from registration or associated safe harbor provisions. The Bureau confinns that disqualification under C.F.R. Section 230.506(d)(l }(iii) should not arise, and is not intended to arise, as a consequence of this order. 14. Each Respondent's respective obligation under this Order is owed severally by that Respondent and not jointly and severally with any other Respondent. ORDER IV. Based on the foregoing, the Bureau deems it appropriate and in the public interest to accept and enter into this Order. THEREFORE, IT IS HEREBY ORDERED THAT: I. Moloney and the Moloney Agents cease and desist from further violations ofthe New Hampshire Securities Act pursuant to RSA 421-B:4-412(d)(9) and RSA 42t-B:5- 50l(b)( 1 ). respectively. 2. Respondent Moloney pay restitution in the amount ofone hundred thousand dollars ($100,000) to the Bureau as described in Section Ill, paragraph 4. 3. Respondent Moloney pay fourteen thousand dollars (S 14,000) to the Bureau towards the cost of the investigation as described in Section Ill, paragraph 5. 4. Respondent Glenn Crny pay disgorgement in of fifteen thousand dollars {$15,000) to the Bureau as described in Section 111, paragraph 6. Page of8

1. Respondent Robert Gustafson pay disgorgement in the amount ofdollars ($35,000) to the Bureau as described in Section III, paragraph 7. 6. Respondent Glenn Cray be placed on heightened supervision by any futurc broker- oftime prescribed above in Section Ill, paragraph 8. 7. Respondent Robert Gustaf.,;on be placed on heightened supervision by any future ofllf. paragraph 9. 8. Respondents comply with the above-referenced undertakings. SO ORDERED. i\ON day of feE>~Uf\F.j . 2026. On ~fJ:~1tre, Co., Inc. __ day of___. 2026. Glenn Cray _ day of____, 2026. Page of8

Robert Gustaf.lion Z~ctay of Felorvc,..,-1 . 2026. Eric A. orcier, Director ofPage of8

1. Respondent Robert Gustafson pay disgorgement in ofdollars ($35,000) to the Bureau as described in Section III, paragraph 7. 6. Respondent Glenn Cray be placed on heightened supervision by any future broker- oftime prescribed above in Section III, paragraph 8. 7. Respondent Robert Gustafson be placed on heightened supervision by any future ofIII, paragraph 9. 8. Respondents comply with the above-referenced undertakings. SO ORDERED. day of_, 2026. On behalfofMoloney Securities Co., Inc. _day of____, 2026. Entered this a, day of ~vv-i

Robert Gustafson L{~ay of 'Felorvry , 2026. Eric A. Forcier, Director ofof8

1. Respondent Robert Gustafson pay disgorgement in the amount ofdollars ($35,000) to the Bureau as described in Section III, paragraph 7. 6. Respondent Glenn Cray be placed on heightened supervision by any future broker- ofIII, paragraph 8. 7. Respondent Robert Gustafson be placed on heightened supervision by any future oftime prescribed above in Section III, paragraph 9. 8. Respondents comply with the above-referenced undertakings. SO ORDERED. day of_, 2026. On behalfofMoloney Securities Co., Inc. _day of_ _ __, 2026. Glenn Cray 'l O day of ~ e_\,:, < '->--<>--<-\ 2026. of8

Robert Gustafson ?,fl( day of fe"cru ry ,2026. Eric A. Forcier, Director of of8