Joshua Allen and Michael Cox convicted in Ferrum Capital fraud case

A federal jury in San Antonio has convicted Joshua Allen and Michael Cox, co-founders of Lubbock-based Ferrum Capital LLC, on all four counts including conspiracy to commit wire fraud, money laundering, and securities fraud.

Prosecutors characterized the firm as a Ponzi scheme that defrauded hundreds of investors of approximately $67.8 million, primarily in the Lubbock and San Antonio areas. Many victims reported losing their life savings or retirement funds. The scheme involved Ferrum Capital loaning money to the Austin-based Collins Asset Group to purchase distressed debt portfolios.

While the convictions provide a sense of justice for victims, attorneys noted that the verdicts do not guarantee the recovery of lost funds. Allen and Cox face a potential maximum sentence of 70 years in prison; sentencing will occur at a later date.