Asset manager GWG files for bankruptcy as risky bond sales dry up

GWG Holdings Inc., an alternative asset manager known for selling life insurance bonds to individual investors, filed for bankruptcy on Wednesday after accounting issues and the resignation of its auditor prevented it from continuing to sell his products.

Dallas-based GWG created financial instruments called L Bonds, which pooled money from bond investors to buy life insurance policies in the secondary market, with the goal of using the payouts from the policy when people are dying to pay off these debts.