Filing Alert: Signal National Chapter 11

Signal National LLC, a Houston, TX-based financial services company specializing in pre-settlement litigation funding and medical receivables financing, file...

Signal National LLC and its debtor affiliates⁽¹⁾, a Houston, TX-based financial services company specializing in pre-settlement litigation funding and medical receivables financing, filed for Chapter 11 protection on Aug. 9 in the U.S. Bankruptcy Court for the Northern District of Texas.

The Debtors' operating history belongs to two entities – 777 Partners LLC and 600 Partners LLC, which were formed by Joshua Wander and Steven Pasko in 2015 and 2017, respectively, to underwrite and finance purchases of structured-settlement payment streams, medical lien receivables, and annuity-backed receivables. The portfolios were financed through asset-backed lending facilities and securitization vehicles whose borrowing bases track the value of eligible receivables, and the assets self-liquidate as the underlying payment streams are collected.

From that base, and accelerating in 2021, the platform expanded into consumer and commercial finance, insurance distribution, aviation and airlines, media and entertainment, and ownership interests in professional sports clubs and leagues across the United States, Europe, South America, Australia, and the Caribbean. At its 2023 peak, the enterprise reported more than $10 billion of invested assets across an organizational chart spanning over 500 legal entities. It now employs 15 people, all working remotely, and has been run since 2024 by restructuring advisers at GlassRatner Advisory & Capital Group LLC, from that firm's offices in Dallas.

The First Day Declaration reported at least $2.71 billion of prepetition funded debt across twelve facilities, though where that debt sits matters as much as its size. About $1.49 billion is owed by Debtor entities, dominated by the ACAP Holdco Facility, at roughly $1.259 billion including interest, alongside eight smaller facilities making up the balance. The ACAP Holdco Facility matured in November 2024 and has been in default since.

The remaining $1.22 billion sits at non-Debtor special-purpose borrowers that the Debtors guarantee — chiefly the $1.19 billion Knightsbridge facility, borrowed by non-Debtor Volans 2018 LLC, and a $28 million ING Capital facility at non-Debtor Sierra 2016 LLC. A facility from Leadenhall Capital Partners is carried at no stated balance and sits outside the reported total, likewise borrowed by non-Debtor special-purpose entities with 777 and 600 as unsecured guarantors, although Leadenhall asserts an approximately $609 million guaranty claim that the Debtors dispute.

The Debtors attribute the reversal to a convergence of developments beginning in 2022. Rising interest rates increased financing costs and affected the valuation and economics of rate-sensitive assets across the platform, while the aviation and professional sports investments were still absorbing the extended effects of COVID-19. Running alongside that, issues emerged concerning the ownership, eligibility, valuation, and allocation of receivables backing certain specialty-finance facilities, including instances in which the same assets were reported as collateral under more than one facility. The Debtors' later forensic work indicates those issues predated the 2024 management transition.

A second pressure came from the insurance side of the group. During late 2023 and early 2024, the Bermuda Monetary Authority took regulatory action against 777 Re, a Bermuda reinsurer held under non-Debtor affiliate Brickell Insurance Holdings LLC. Its license was ultimately revoked and it is now in wind-down. Counterparties began recapturing business and related assets, reducing the reinsurer's asset base and squeezing businesses across the group that had depended on it for capital or liquidity. Combined with tightening credit, mounting creditor concerns, and adverse publicity surrounding Wander and the Company's never-completed bid for English soccer team Everton F.C., access to outside capital contracted sharply by late 2023, leaving the Company unable to fund expansion or, before long, ordinary operations without lender forbearance. Wander and Pasko resigned in May 2024 and were replaced by the independent restructuring management now running the company.

Litigation also followed. On Oct. 16, 2025 the SEC sued Wander, Pasko, 777 Partners, 600 Partners, and former CFO Damien Alfalla, alleging they misled investors about the Company's financial condition and fraudulently induced a $237 million preferred-equity offering. The same day, the U.S. Attorney's Office for the Southern District of New York unsealed an indictment charging Wander with defrauding lenders and investors of more than $500 million, principally through double-pledging collateral and digitally altering bank statements. Alfalla pleaded guilty and, along with Pasko, resolved the SEC claims by consent judgment. Prosecutors filed a superseding indictment against Wander on June 30, 2026, and trial is set for Oct. 19, 2026.

The most consequential creditor dispute is with Leadenhall Capital Partners, which lent to four special-purpose non-Debtor borrowers, with 777 and 600 standing as unsecured guarantors. Leadenhall brought RICO and fraudulent-inducement claims in May 2024, alleging that collateral securing its facilities had also been pledged to other lenders. In May 2025 it conducted Article 9 foreclosure auctions of the receivables portfolios held by three of those borrowers — portfolios the Debtors say Leadenhall had valued at more than $170 million — acquiring them for nominal $1 credit bids. The Debtors contend the sales were not conducted in a commercially reasonable manner and were engineered to inflate Leadenhall's guaranty claim against the parents, and are litigating to establish that they bear no deficiency liability. On March 23, 2026 the Second Circuit vacated a preliminary injunction that had restrained the guarantors' assets, holding that Leadenhall asserted no valid lien on or equitable interest in them.

Prior to the chapter 11 filing, beginning in 2024, the Debtors wound down most of the operating platform out of court, funded largely by protective advances from the senior secured lenders. The largest transactions retired debt rather than raising cash, including the transfer of a UK equity-release business to an ACAP affiliate in satisfaction of up to $275 million and an Article 9 disposition of international football club interests satisfying $157 million.

On July 16, 2026, Vida — three affiliated credit funds holding a $26 million judgment against 777 Partners under a $59.7 million July 2020 margin loan — filed an involuntary chapter 7 petition against 777 Partners in the Southern District of Florida. The Debtors state they sought a consensual resolution with Vida but were unable to reach one. The Debtors stated that additional subsequent Debtors are expected to file for Chapter 11 within approximately 60 days, and will ask the Florida court to convert the involuntary case to chapter 11 and transfer venue to Texas, and do not intend to contest entry of an order for relief.

The Debtors filed Chapter 11 to carry out a court-supervised wind-down rather than a balance-sheet restructuring, and are seeking a DIP facility of up to $24.95 million from the prepetition lenders that funded the out-of-court wind down. $6.24 million of the DIP facility is new money and $18.71 million is a roll-up of prepetition debt. The Debtors intend to sell remaining assets during the cases, centralize claims resolution and pause the surrounding litigation, and propose a plan transferring longer-duration assets to a liquidating trust for monetization over a period of years — principally the self-liquidating structured-receivables portfolios and related servicing operations, together with residual equity and contract rights, the Leadenhall commercial-reasonableness and injunction-bond claims, and avoidance actions.

The company reports $100 thousand to $500 thousand (affiliates report assets of up to $10 million to $50 million) in assets and $1 million to $10 million (affiliates report liabilities of up to $1 billion to $10 billion) in liabilities. The filing indicates that there will be funds available for distribution to unsecured creditors. The case number is 26-90190.

⁽¹⁾ For a complete list of debtor entities, see the Chapter 11 Debtors table.

Chapter 11 Debtors

Affiliated Debtors Chart
Source: Bondoro, Court filings

Top Unsecured Claims

Form 204 Top Unsecured Claims
Source: Bondoro, Court filings

Key Parties

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