: A lawsuit filed in 2021 details a plaintiff from Wisconsin who invested $1 million in January 2021 and an additional $1 million in June 2021, despite suffering from cognitive difficulties at the time.
In 2021, the Texas State Securities Board (TSSB) was actively investigating Willy. The TSSB's records show that in 2019, Willy was terminated from J.W. Cole for "violation of firm policies regarding participation in unapproved private securities transactions". Later, when Willy tried to register with the Securities Commissioner as an investment adviser representative, the TSSB claimed that she failed to disclose her involvement in selling alternative investments and was never properly registered as a dealer. These findings were part of a longer history of regulatory concern that would later be central to the allegations against her.
: In May 2021, Willy allegedly advised clients to invest $500,000 into a new Ferrum entity. ferrum capital lawsuit 2021
The fallout from Ferrum Capital's collapse has resulted in a tangled web of legal battles spanning across Texas and beyond.
: A judge later ruled that Ferrum sold unregistered securities in violation of Texas law. Key Findings & Legal Consequences : A lawsuit filed in 2021 details a
The defendant filed a vigorous response in mid-2021, seeking to dismiss Ferrum’s claims and filing counterclaims for . Their defense centered on three key arguments:
: Michael Cox filed for bankruptcy in February 2024, claiming he owed nearly 400 people or businesses—most of them for a "loan to Ferrum Capital"—a total of $59 million. Victims in the class action lawsuit have since challenged the bankruptcy. In May 2025, a U.S. Bankruptcy Judge ruled that the promissory notes sold by Ferrum Capital and its entities were unregistered securities and that Cox could not discharge his debt against the roughly 80 plaintiffs in the class action, who are suing him and others for more than $21 million. The receiver for Ferrum has also sued 65 of the company's former investors—so-called "net winners" who made a profit at the front end of the Ponzi scheme—to claw back over $4 million to distribute to the scheme's victims. Cole for "violation of firm policies regarding participation
Beginning around 2018, Ferrum Capital and its related entities (Ferrum II, III, and IV) solicited investments by promising over four-year periods.
in a Ferrum entity. Instead of investing the funds, she reportedly used the money for personal expenses and to pay off other investors—a classic hallmark of a Ponzi scheme. Federal Charges (2025-2026) : In July 2025, Ferrum Capital owners Joshua Allen Michael Cox were indicted alongside
The significance of the Bexar County lawsuit cannot be overstated. It was the catalyst that led to the company's downfall. Following this lawsuit, a judge took control of Ferrum Capital, placing it under receivership in January 2024. The receivership would ultimately expose the full scale of the fraud and begin the process of trying to recover funds for victims.