Litigation funding isn't a business for the faint of heart. But Houston-based funder Virage Capital Management's record since its 2013 launch shows a particularly close relationship to risk: Its lending is part of the story in at least four notable law firm collapses, three of which have also involved firm attorneys who've been charged or investigated by regulators over misappropriating funds.

Virage, founded by former Enron director and vice president Edward Ondarza, has frequently turned to the courts to collect on its loans after borrowing firms default and declare bankruptcy. The court docket in Harris County, Texas, shows four ongoing lawsuits launched by the company in the district, with the litigation funder suing dying firms for amounts ranging from $300,000 to $15 million to $85 million.