‘We fell for it,’ – ‘Still working, I’m 72’: Ferrum victims tell heartbreaking stories

People who lost all or much of their retirement savings in Lubbock-based Ferrum Capital testified Monday and Tuesday in Bexar County’s 131st District Court.

Most were from the San Antonio area, and often their initial contact was Brooklynn Chandler Willy, Ferrum’s San Antonio affiliate. Many of them heard about her from her radio show and television appearances.

People trusted the advice, but according to the testimony, their trust was betrayed.

Nine victims testified, but the total number of people hurt by the collapse of Ferrum and related companies – “the cabal” as it was described by attorney Randall Pulman, who represents more than 70 Ferrum victims – was possibly up to 400, according to information presented in court.

One example, Joan Raver of San Antonio testified her husband John, now age 71, has gone back to work – no longer able to remain retired.

The Ravers, on Willy’s recommendation, put nearly $500,000 into Ferrum’s related company, Ferrum IV and lost it.

“To have it stolen from us, completely on someone we trusted, and John especially trusted greatly … it’s been devastating,” Raver testified.

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‘Still working. I’m 72’

Judy Musgrove is the lead plaintiff in the lawsuit in court this week. It bears her name – Musgrove v. Willy.

“I’m still employed. I’m still working. I’m 72. But I’ll be okay,” Musgrove testified.

Musgrove knew about Willy from her radio infomercials. She and her husband met with Willy for the first time in the winter of 2018 or spring of 2019, she said.

“The very first thing she said when we presented her with our [another financial company’s] statements, she said. ‘You’re paying too much in fees, and you’re not making enough money,’” Musgrove said.

She invested more than $300,000. Aside from $2,800 Pulman was able to recover for her so far, the money is gone.

Her sister, Kathleen Priebe, invested with Ferrum too, said Musgrove – more than $243,000, according to court records.

“I received a green binder in the mail from Brooklynn [Willy],” Musgrove testified.

“I looked through it briefly but did not study it. … My sister called me and asked if I went thought it,” Musgrove said in court.

She looked again and found refund check for Willy’s commission – the same commission state regulators ordered Willy to give back.

“I did start reading some of the documents closely and got a sick feeling about the documents and why I was receiving a check,” Musgrove said.

“There wasn’t a cover letter at the beginning of it,” Musgrove said.

The check was “very obscure” in the back of the green binder, she said.

Musgrove had two investments with Willy. Ferrum and Noble Capital Income Fund.

In Ferrum, she got a refund for Willy’s commission because state regulators sanctioned her for selling unregistered securities, which included Ferrum.

Willy was ordered to pay back commissions but the testimony in court indicated that did not always happen.

On the Noble investment, Musgrove testified her signature was forged on a waiver for Willy to keep the commission.

The Noble refund check was marked out in bold letters “waived.”

“I am in the business of credit and collections,” Musgrove said.

The statement was ironic in light of the nature of Ferrum’s activities – funding debt collection for Collins.

Toward the end of time on the stand, she directed one of her comments to the judge.

“I think, your honor, something that is just very, very sad, is that all of these appears to be with intent. A lot of people in the court and probably on the Zoom have been harmed by the fraud that has been committed here,” Musgrove testified.

‘I wanted to establish trust’

“In 2018, I was approaching retirement age,” said Paul D. Sheetz of San Antonio.

Sheetz was looking for an investment advisor and someone suggested Willy’s company.

“I wanted to be able to look that person in the eye and establish trust. I was looking for a permanent lifetime investment relationship,” Sheetz said on the witness stand.
Instead, he lost all but a fraction of his investment with Willy and Ferrum.

Ferrum promised its investors the money would go toward buying distressed debt for pennies on the dollar. If its partner company, Austin-based Collins Asset Group, could successfully collect the debt, everyone would make money.

That sounded reasonable to Sheets, who had professional experience managing debt portfolios.

“So, I was familiar with the model. I was knowledgeable of the profession,” Sheetz testified.

He was not familiar with Collins, which has since filed for bankruptcy.

Sheetz met with Willy several times in 2018 and, “I was thinking 10 percent is a pretty good rate of return. … So, I chose that,” he said.

He asked Willy how she would make money.

“She told me she was getting a one percent commission. Okay, that sounds reasonable,” Sheetz said.

But he had no idea she was getting the lion’s share of a 10.75 percent Ferrum commission.

He was meeting with her twice a year. Sometime, maybe in early 2020, she mentioned “this thing going on.”

The “thing” was the order by the Texas State Securities Board sanctioning Willy for selling unregistered securities.

“She’s telling me she’s gonna have to refund commissions to her clients. Again, I’m thinking, ‘It’s one percent. You earned the commission.’ I signed – she asked me to sign a waiver,” Sheetz testified.

Willy kept the commission she owed Sheetz – the commission she was ordered to give back.

Sheetz saw her name in a 2021 Express-News article. Willy was sued by a couple who claimed she breached her duty to them in a fraudulent investment. The article also pointed out Willy was sanctioned by state regulators for selling unregistered securities.

“I called her… I had a conversation with her about what was in the Express News. She’s got her own story,” Sheetz testified.

“It’s all a big misunderstanding. You’re still gonna get your money,” Sheetz quoted her as saying.

He never did – except for a small amount, $3,092, Pulman was able to recover so far.

Sheetz invested $300,000 with Willy. His wife put up more than $56,000.

It fell apart in 2023. Collins defaulted on the money it owed Ferrum, according to multiple lawsuits, and Ferrum in turn defaulted to its investors who were often from either the Lubbock or San Antonio areas.

But Sheetz said he knew his money was gone even before that.

‘We fell for it’

Alvin Zigmond worked 40-plus years for a construction company and retired in 2015, he said.

He knew of Willy from her radio show.

“We had listened to her on the radio for a number of years. Then we got an invitation to one of her retirement seminars. … She talked a pretty good story. So, we decided to invest our 401k with her,” Zigmond said.

He started investing with Willy in 2015. Trouble started in 2018, he testified.

“She just said she had this wonderful investment that was available to a select few,” Zigmond said from the witness stand.

Zigmond’s investment did well in the first four years. He was paid back more than $46,000 so his claim is smaller than it might have otherwise been. But he still lost more than $214,000 because he reinvested.

“When we first invested with her we said we didn’t want anything that was risky. All she told us was these investments would be safe and guaranteed. We fell for it,” Zigmond said.

‘I trusted her’

Tamara Owrey fell for it too. She retired after more than 40 years as a registered nurse.

Now she’s back at a job for $15 per hour. She filed a claim against Ferrum for more than $210,000 – half of her retirement money, she testified.

Willy made an emotional connection with Owrey, which Owrey admitted worked.

“We are a woman run company,” Owrey quoted Willy as saying. “I trusted in her.”

‘It’s a huge dent in our retirement’

Barbara Munzy testified she and her husband of 46 years knew of Willy from her radio show. Her claim against Ferrum IV – European bonds involving another entity, Ryan Project Funding – was for $410,000.

“We’ll be okay. It’s a huge dent in our retirement. I think we’re gonna be okay,” Munzy claimed.

She asked Ferrum co-founder Michael Cox over the phone if this was a safe investment, she said.

“We were told [worst] case scenario we would get our principal back without interest,” Munzy said.

Allen, Cox and Willy took advantage of senior citizens who worked hard all their lives and saved their money year after year, she said.

Lost $300,000

Diane Durant testified she and her husband lost $300,000, after attending a free dinner event Willy hosted.

“This was a significant amount of money in our retirement,” Durant said, getting emotional as she talked about things she and her husband wanted to do with their children and grandchildren.

‘She said everything was fine’

Carolyn Newman retired in 2015, having worked in a hospital for 35 years as a laboratory technologist.

“All my plans kind of got cut in half,” Newman testified, adding her claim was $103,600.

“I had seen her on TV and on the radio I had heard her,” Newman said of Willy.

When news broke about Willy’s trouble with state regulators and the first of several lawsuits against Willy, Newman asked questions.

“She said everything was fine. My money was still there. … Then she promised me in four more years you would have $150,000,” Newman testified.

But it wasn’t fine.

“My husband is 74, and he’s actively working,” Newman testified.

“She’s just a very deceitful person,” Newman said of Willy.