People who lost millions of dollars to Lubbock-based Ferrum Capital – and their attorneys – were celebrating Thursday a day after Joshua Allen and Michael Cox had to show up in court in San Antonio on a recent federal indictment.
“The clients I talked to yesterday were ecstatic. That day’s finally here. They finally had to go before a judge in shackles,” said Lubbock attorney Ed Price, representing many of the victims in various lawsuits against Allen, Cox and San Antonio-based Brooklyn Chandler Willy.
“They finally had to go before a judge in shackles.”
ed price, attorney
What’s not known is if the indictments will help victims get some money back.
Price was optimistic when asked if the criminal charges help or hurt the people who filed lawsuits.
“The first question mark is going to be is there going to be a plea? … If there’s trials, that’ll take more time,” Price said.
He was pleased to see the case prosecuted in San Antonio.
“They have more resources and I know specifically from visiting with the U.S. Attorney down there, that they have some folks that specifically deal with restitution and recovery,” Price said.
The indictment seeks to recover “proceeds traceable to the violations.”
“I want them to go to jail. I want them to have to sit there and suffer the consequence of their actions.”
Susan Hunter
“There’s the possibility that this will help to bring some of our recovery efforts forward,” said San Antonio attorney Matthew King, who represents a different set of victims from Price.
“These are people whose lives have been turned upside down in lots of different ways by this. And in many ways, this was a day that they’ve been waiting for,” King said.
Price added, “They do feel better that maybe these guys are not going to get away with it.”
Susan Hunter, one of those victims, told LubbockLights.com Thursday, “I want them to go to jail. I want them to have to sit there and suffer the consequence of their actions.”
“I think our first words were, ‘Finally, the wheels of justice,’” Susan said, interviewed with her husband Terry.
Terry added, “Finally, something was finally moving forward.”
Court records showed the Hunters lost money in Ferrum and in a separate transaction with Allen.
Waiting was hard, Terry said, because outsiders unfamiliar with the case were skeptical.
“Well, they must not have done anything wrong because nothing’s happened,” Terry characterized some of Allen’s supporters as saying.
Susan said of Allen’s friends, “He had a small group of people that thought he was just under attack from Satan. … They went through the same stages that we did – shock and denial. ‘There’s no way you could have done this.’ And then when we realized yes, he had done it.”
Indictment unsealed
A federal judge unsealed the indictment Thursday morning. Allen and Cox were charged with three counts of conspiracy related to wire fraud and money laundering along with one count of securities fraud.
“Hundreds of victims invested approximately $67 million into Ferrum Capital,” the indictment said.
Many of those victims are from Lubbock or San Antonio. LubbockLights.com has been following the story since December and found some people, including elderly couples, lost everything – their entire life savings to Allen, Cox or Willy.
Some of the details were already released in a statement from prosecutors Wednesday afternoon. The same federal grand jury in San Antonio reindicted Brooklynn Chandler Willy, an affiliate of Ferrum Capital, in addition to the charges against Allen and Cox.
The statement said if convicted, they face up to 70 years in prison. Their next court hearing is scheduled for July 23. Both men were allowed to post a bond to remain free while the case is pending.
The attorney for Willy previously declined to comment for LubbockLights.com. While criminal attorneys are not yet listed for Allen and Cox on the court docket, their civil attorneys have declined comment numerous times.
Indictment details
“Investments in Ferrum Capital began in December 2017 and were done through a four-year note with either 8% interest paid quarterly or 10% annual interest paid at the end of the four-year term,” the indictment said.
Investors were told the money went to a debt-buying company for collections. Based on other court records in numerous lawsuits, that company was Collins Asset Group. No one from Collins was charged in this case, but the company – which recently filed for bankruptcy – is accused of wrongdoing in various lawsuits.
Complete Ferrum Capital Coverage
“Generally, Ferrum Capital would take at least 10.75% of investor funds as ‘commissions’ and send the remaining investor money to the Debt Buying Company. In 2022, investors began to redeem their notes,” the indictment said.
That’s when the trouble became obvious. To pay the investors, Allen, Cox and Willy, “solicited new investors.” The new investors, just like the old investors, were told the money would go to the debt collection company.
“Instead, beginning in March 2022 until August 2023, new investor funds were used for the benefit of Allen, Cox and Willy,” the indictment said.
The exact dollar figure varied in different court records. For example, Cox filed for bankruptcy in 2024, admitting to $59 million of debt. Later, as the case developed, the bankruptcy claims registry listed more than $82 million.
“Allen, Cox, Willy and others affiliated with them collectively made millions of dollars while most of the investors lost some or all of their investment,” the indictment said.
See the indictment
Click here to read the indictment (opens in a new window).
The Cox bankruptcy listed nearly 400 people or businesses that put money into Ferrum.
The accusation of a “scheme and artifice to defraud” was from November 1, 2017, through December 10, 2024.
“Allen, Cox, and Willy routinely told investors their money was safe, secure, and collateralized. In truth, much of the victims’ money was never invested but went to the benefit of Allen, Cox, and Willy, or paid to other investors,” the indictment said.
But there was more than one round of fraud, according to the indictment.
In one case, the three solicited $3.1 million dollars with a promise of a 20% return for an entity called RPF.
“After raising the initial investment amount, Allen and Cox sent that investment to be used by RPF, and it was never returned. Allen and Cox then decided to solicit new investment and used that money to, among other things, pay back the original investors,” the indictment said.
“The second round of investors lost most or all of their investment while Allen, Cox, Willy, and others made millions collectively,” the indictment said.
Some of that money was funneled through Willy to “conceal the source of the funds,” according to the indictment.
King hopes Collins faces charges
King also hopes federal prosecutors will put an end to the operation once and for all, saying no one from Collins Asset Group was indicted.
Collins was named previously in a class action lawsuit – amid similar accusations – and settled in late 2020. One person associated with an affiliate company, Daryl Bank, was sentenced to prison time – which LubbockLights.com covered in this article.
King thinks federal officials had a chance to do something about Collins Asset Group at that time. Instead, the company found a new partner, Ferrum Capital in Lubbock.
“It’s very frustrating to people who have lost a substantial portion of their savings … that not only deal with that loss but also all the cover-ups and the dishonesty,” King said.
“We can never really satisfy clients with what we can recover for them to the same degree that ‘seeing justice served’ can do,” King added.
