GPB Investigation | GPB Capital Holdings Fraud Investigation | What Happened?

GPB Investigation – Over the course of the year, multiple lawsuits have been filed and regulatory matters have been initiated alleging that GPB Capital Holdings has been engaged in wrongdoing. Most notably, former GPB Holdings operating partner, Patrick Dibre alleged that “losses occasioned by GPB were in fact caused by a very complicated and manipulative Ponzi scheme.”  The claim further alleges that “GPB paid its investors significant returns based upon falsified financial information.” If you invested in any GPB Capital Holdings Fund, contact Peiffer Wolf and Meyer Wilson immediately.

GPB Investigation

GPB Investigation | Ongoing Investigations into GPB Capital Holdings

 

GPB Investigation – GPB Investors were pitched attractive returns by the broker-dealers who sold the GPB Funds. Brokers, however, were motived by the 8% commission for selling GPB funds. It now appears as if brokers received more than $100 million in commissions.

 

According to its website, “GPB Capital is a New York-based alternative asset management firm focusing on acquiring income-producing private companies.” Of note, GPB has a strong focus on the “automotive retail” sector. Since 2013, GPB raised $1.3 billion from investors in its GPB Automotive Portfolio and GPB Holdings II funds (“GPB Funds”).

 

Peiffer Wolf and Meyer Wilson are currently investigating claims against GPB, as well as the brokers and broker-dealers that sold GPB Funds. Contact Us Today by calling 888-390-6491 or by filling out an online Contact Form for a FREE Consultation. Concerns about possible misconduct and fraud are serious, and we are committed to fighting on your behalf.

 

The Securities Law Firms of Peiffer Wolf and Meyer Wilson are investigating the sales practices and due diligence of Financial Industry Regulatory Authority (“FINRA”) brokers who sold the private placement securities of GPB, as well as their affiliated brokerage firms.

 

Furthermore, the notes that were sold are considered private placement, or non-traditional, investments that are not registered with the SEC. These inherently risky investments are often only suitable for sophisticated investors. However, many brokerage firms and financial advisors still sell these products because they offer higher commissions.

 

According to an August 2018 news report, GPB notified investors that they should no longer rely on 2015 and 2016 financial statements and reports. The CEO of GPB, David Gentile, disclosed that “certain material weaknesses in internal controls exist.” This disclosure followed an internal accounting review, freezing monthly interest payments.

 

GPB Investigation | GPB Capital Holdings Struggles

 

In July 2017, GPB entered litigation against a former business partner who allegedly reneged on a sale of multiple car dealerships. GPB sought the return of $42 million it had paid to the former business partner. As the lawsuit continues, additional problems for GPB have begun to surface:

GPB lawsuit

April 2018

GPB failed to produce audited financial statements;

August 2018

GPB announced no new investor capital would be accepted;

September 2018

Massachusetts Division of Securities launched investigation;

November 2018

GPB’s auditor resigned, citing perceived risks;

December 2018

FINRA and SEC launched investigations into broker-dealers that sold GPB;

February 2019

The FBI and New York City Business Integrity Commission made an unannounced visit to GPB's office in New York

June 2019

GPB reports losses in two of its largest investment funds:

GPB Holdings II (-25.4%) and GPB Automotive Portfolio (-39%). Smaller funds also registered losses (25 to 73%). National Financial Services removes GPB Capital’s securities from its platform and sets a 90 days deadline for broker-dealer clients to move private placements off of its platform.

July 2019

Class action lawsuit filed on behalf of investors against GPB Capital Holdings;

August 2019

David Rosenberg accuses GPB of running a ''Ponzi-like'' scheme.

David Rosenberg, a principal of a private company and one of GPB’s business partners, Prime Automotive Group in Massachusetts, is also accusing GPB in publicly-available court papers of financial misconduct and running a ''Ponzi-like'' scheme;

September 2019

Audited financials release delayed and Prime Automotive problems continue.

GPB sends a letter to investors revealing it won’t release audited financial statements by Dec 31, as previously promised. David Rosenberg is fired, and GPB Capital appoints Kevin Westfall as Prime Automotive’s interim chief executive.

October 2019

Peiffer Wolf and Meyer Wilson filed complaints on behalf of 91-year-old Florida widow and retired Russian emigre couple in Oregon.

Michael Cohn, GPB’s Chief Compliance Officer and Managing Director, is charged by the U.S. Attorney’s Office for the Eastern District of New York with obstruction of justice, unauthorized computer access and unauthorized disclosure of confidential information.

November 2019

A new class action lawsuit is filed by Peiffer Wolf and Meyer Wilson on behalf of GPB investors.

During a News Conference, the whistleblower who first reported GPB to FINRA and the SEC reveals that she has filed multiple police reports after a series of threatening incidents. In the same month, GPB informs its investors that its auditor has suspended all work, the Audit Committee is resigning at the end of November, and no financial statements will come out in 2019. GPB also reveals to investors that the Automotive Portfolio and GPB Capital Holdings II Fund have collectively lost more than $330 Million.

December 2019

News broke that David Rosenberg, the former CEO of Prime Automotive Group, had amended his lawsuit against GPB in an attempt to get reinstated as CEO of Prime Automotive.

The lawsuit states that at least 4 automakers – Audi, Subaru, Toyota, and Volkswagen – have expressed concerns that GPB did not follow their business agreements when ousting Rosenberg.

GPB Investigation in the News. According to InvestmentNews, “As many as 60 broker-dealers have sold GPB funds. While many were smaller [independent broker-dealers] IBDs, among the most prominent listed in Securities and Exchange Commission filings were four Advisor Group broker-dealers: Royal Alliance Associates Inc., Sagepoint Financial Inc., FSC Securities Corp., and Woodbury Financial Services Inc.”

 

Brokers licensed with FINRA are required to follow rules, laws, and regulations when recommending the purchase or sale of a security. Additionally, the broker-dealers are required by law to supervise broker activities.

 

Contact Peiffer Wolf and Meyer Wilson for a FREE Consultation by calling 888-390-6491 or by filling out a Contact Form today to if you were an investor in a GPB Fund. Peiffer Wolf and Meyer Wilson represent investors across the United States and throughout the world.

GPB Investigation

According to the public filings on the SEC website, the following brokerage firms were authorized to sell GPB Capital funds to their customers:

Accelerated Capital Group

Advisory Group Equity Services, Ltd

Aegis Capital Corp

Avere Financial Group, LLC

Axiom Capital Management, Inc.

Cape Securities, Inc.

Capital Financial Services, Inc.

Woodbury Financial Services, Inc.

Triad Advisors, LLC

Stephen A. Kohn & Associates, Ltd.

David A. Noyes & Company

Capital Investment Group, Inc.

Dawson James Securities, Inc.

D.H. Hill Securities, LLLP

Crystal Bay Securities, Inc.

IBN Financial Services, Inc.

Lewis Financial Group, L.C.

Lion Street Financial, LLC

Money Concepts Capital Corp.

Purshe Kaplan Sterling Investments

Uhlmann Price Securities, LLC

Aeon Capital, Inc.

American Capital Partners, LLC

Arete Wealth Management, LLC

BCG Securities, Inc.

Benjamin & Jerold Brokerage I, LLC

Cascade Financial Management, Inc.

Center Street Securities, Inc.

Wilmington Capital Securities, LLC

Vanderbilt Securities, LLC

United Planners’ Financial Services of America, LP

Coastal Equities, Inc.

DFPG Investments, Inc.

Innovation Partners LLC

Detalus Securities, LLC

FSC Securities Corp.

Investment Architects, Inc.

Lowell & Company, Inc.

Madison Avenue Securities, Inc.

National Securities Corp.

Sandlapper Securities, LLC

Vestech Securities, Inc.

Arkadios Capital

Ascendant Alternative Strategies, LLC

Ausdal Financial Partners, Inc.

Cabot Lodge Securities, LLC

Colorado Financial Service Corp.

Calton & Associates, Inc.

Concorde Investment Services, LLC

Windsor Steet Capital, LP

Westpark Capital, Inc.

Western International Securities, Inc.

Crown Capital Securities, L.P.

Financial West Group

Kalos Capital, Inc.

Landolt Securities, Inc.

Geneos Wealth Management, Inc.

Kingsbury Capital, Inc.

McNally Financial Services Corp.

Orchard Securities, LLC

Silber Bennett Financial, Inc.

Whitehall-Parker Securities, Inc.

FREE Consultation | 888-390-6491

 

Based on our experience, we believe that there are more investors who have been the victim of broker misconduct or investment fraud. If you invested in any GPB funds, you should contact Peiffer Wolf and Meyer Wilson immediately. We are currently investigating the brokers and broker-dealers that sold GPB funds. Concerns about possible broker misconduct and investment fraud are serious, and we are committed to fighting on behalf of investors.

 

If you believe you were a victim of investment fraud or broker misconduct, it is imperative to take action. Peiffer Wolf and Meyer Wilson have represented thousands of victims, and we remain committed to fighting on behalf of investors. Contact Peiffer Wolf and Meyer Wilson today by filling out a Contact Form on our website or by calling 888-390-6491 to schedule a FREE Case Evaluation.

If you invested in any GPB Capital Fund, Contact us Today for a FREE Case Evaluation.