Securities Lawyers Blog
Our firm represents multiple clients who have been recommended GPB Capital Holdings (GPB Capital) related investments. GPB invests in a variety of businesses but primarily in auto dealerships and waste management businesses. However, over the past year controversy has embroiled GPB Capital in a saga including multiple regulatory investigations and even an FBI referral which has left investors clueless to the fate of their investments.
Recently, GPB Capital released its own internal analysis and valuation of its funds without providing any evidence to support its findings. The results were not good for investors. As reported by InvestmentNews, the two largest funds offered GPB Holdings II and GPB Automotive Portfolio have declines of 25.4% and 39%. However, some of the other funds, like Armada Waste, fared much worse declining to only 32% of their original value. Again these valuations are provided by GPB Capital and only after a year of accounting mishaps.
As a background, financial advisers sold $1.5 billion of these high-risk private placements offered by GPB Capital Holdings. More than a year ago GPB Capital was supposed to file registration forms with the SEC for two of its largest funds to make certain accounting and financial disclosures required under the securities laws. However the company did not meet its deadline back in April 2018 and now over a year later has no firm date when annual reports for the two funds will be filed and the public has no clue what those values will look like.
In representing our clients, they have alleged that one aspect of their brokerage firm’s failures to conduct due diligence was to investigate GPB Capital’s senior management. In or about 2013, GPB Capital was founded by David Gentile (Gentile). Had brokerage firms investigated GPB Capital’s senior manager it would have found that prior to founding GPB Capital, Gentile’s experience was as a CPA and company advisor with the accounting practice his family ran at Gentile Pismeny & Brengel, LLP (GP&B) in New York. Nonetheless, GPB’s PPMs claimed expertise in these areas. See GPB Holdings II, LP, PPM, pg. 9 (Apr. 13, 2015) (“GPB’s senior management have a great deal of experience investing in the Automotive Retail, Managed IT Services and Life Sciences sectors.”). Any investigation would have revealed that GPB Capital is merely the private equity investment arm of a plain vanilla accounting practice. There is no evidence that GPB Capital’s senior management had the knowledge, industry experience, or investment experience to run the operations of a $1.8 billion dollar mult-asset strategy private equity fund and should not have been entrusted with investor funds.
GPB Capital Holding’s funds include:
GPB Cold Storage
GPB Automotive Fund
GPB Automotive Income
GPB Holdings II and III
GPB Waste Management
GPB NY Development
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.