The former top executive of the parent company of a unique type of Kansas financial institution has been found guilty on charges he set up a shell company to enrich himself with more than $150 million and pump up his lavish lifestyle, federal prosecutors announced Thursday.
A jury found Bradley Heppner, 60, guilty of securities fraud, wire fraud, conspiracy to commit securities fraud and wire fraud, and making false statements to auditors in connection with the scheme, said Jay Clayton, U.S. attorney for the Southern District of New York.
Heppner is scheduled to be sentenced in October. He faces a maximum sentence of 20 years in prison on each of the counts of securities fraud, wire fraud, and false statements to auditors, and a maximum of five years in prison on the conspiracy count.
“Our world-leading capital markets are built on trust and transparency,” Clayton said in a statement.
“The honesty and candor of C-Suite executives is essential, and this action should send a message: C-Suite executives who breach the public trust will be pursued by the SDNY’s Securities and Commodities Fraud Task Force and our dedicated partners at FBI, vigorously,” he said.
“That is what investors and the American people want and deserve.”
Heppner is the former chief executive of Dallas-based Beneficient, the parent company of Beneficient Fiduciary Financial, which operates in Kansas as a Technology-Enabled Fiduciary Financial Institution under a state law the Legislature enacted in 2021.
The so-called TEFFI was created with the goal of giving sophisticated investors the ability to liquidate alternative assets such as venture capital and private equity that aren’t easily converted to cash.
Heppner stepped down in June 2025 from Beneficient, the Dallas-based company that he founded where he was chair of the board of directors and served as chief executive office.
Heppner was the face of Beneficient when lawmakers overwhelmingly approved legislation authorizing the institution in 2021. It passed with 39 votes in the Senate and 103 votes in the House with 20 opposed. The governor signed the bill into law.
Shortly after Heppner was indicted last year, executives of Dallas-based Beneficient and its Kansas subsidiary appeared before a joint legislative oversight committee.
At that time, they stressed that none of the allegations in the indictment against Heppner applied to the Kansas subsidiary and Kansas, although the state’s banking commissioner had sounded alarms about the company for years and urged for heightened oversight.
“As someone who in front of this committee sat next to Mr. Heppner on multiple occasions, if these allegations are true, I’m not just disappointed, I’m angry and I’m guessing a number of you are angry as well,” said former state Sen. Jeff King, counsel for Beneficient.
“Having kicked the tires and looked at the business model that Beneficient brings, I still believe this business model is a strong one and that it can work,” King told the committee last year.
“I remain optimistic and hope that the anger at the allegations of one individual can turn into something that still can be positive for the state,” he said.
Beneficient could not be immediately reached for comment Thursday afternoon.
The federal indictment centers on how Heppner set up a shell company that would benefit from tens of millions of dollars that he falsely claimed was owed by Beneficient to a third company he controlled.
In the process, Heppner was accused of looting another publicly traded company – a company he chaired – by persuading it to invest in Beneficient to help pay the debt.
The company – GWG Holdings – later filed for bankruptcy, causing losses exceeding $1 billion for thousands of investors and bondholders, the indictment said.
Between 2018 and 2021 and largely before Kansas entered the picture, Heppner – as chair of GWG – carried out a scheme to fraudulently divert GWG funds for his own benefit to a shell company he controlled called the Highland Consolidated Limited Partnership, otherwise known as HCLP, federal prosecutors said.
Heppner was accused of using the proceeds flowing into Beneficient from GWG and subsequently to the third company for personal use, including more than $40 million for renovations and decorations in his mansion.
Other personal expenses included more than $10 million for upkeep and expansion at his ranch and mansion, more than $10 million for personal credit card and private air travel expenses and more than $500,000 on jewelry.
Heppner was accused of creating a $141 million debt owed to Highland Partnership from his private company, Beneficient, according to court records.
Heppner described it as a loan from an independent third party that had provided the money to start Beneficient, according to court records.
But the indictment said the debt was not a “conventional loan” from a third-party lender that helped get Beneficient up and running.
Instead, the debt originated when Heppner allegedly directed an employee to tally up old, informal payments he had made out of HCLP for personal expenses such as the purchase of a 1,500-acre ranch in East Texas.
Heppner directed the employee to classify the expenses as debt Beneficient owed to HCLP, the indictment said.
Heppner then made the debt appear like a formal loan by having an HCLP subsidiary enter into an agreement with Beneficient to provide a $141 million loan to refinance Beneficient’s debt, according to the indictment.
The creation of the debt owed to a purported third party reportedly gave Heppner the ability to “extract money” from Beneficient ahead of all other stakeholders.
Under Beneficient’s capital structure, HCLP’s debt held senior priority over all other obligations, and as a result Beneficient was purportedly required to pay HCLP before satisfying any other claims before other lenders, equity investors or any other party, the indictment said.
To hide the plot, federal prosecutors said Heppner made false and misleading statements and was responsible for having fraudulent documents prepared to deceive auditors as they tried to determine whether Highland Consolidated Limited Partnership operated independently of Heppner.
After GWG received a subpoena from the Securities and Exchange Commission, Heppner also falsified the minutes of an October 2019 board meeting, prosecutors said.
They say he added language to the minutes to create the false appearance that he had previously disclosed to Beneficient his history of borrowing funds from the Highland Partnership.
