INVESTOR ALERT—The Wolper Law Firm Is Actively Investigating Claims For The Recovery Of Investment Losses In GPB Capital

The Wolper Law Firm is currently investigating potential claims against various brokerage firms, who recommended that their clients invest in private placement securities issued by GPB Capital Holdings, including the GPB Automotive Portfolio and GPB Holdings II.

It appears that investors may lose a significant amount of money after GPB Capital Holdings failed to file required SEC reports in April 2018.  Securities regulators have since launched investigations into GPB Capital Holdings and brokerage firms’ sales of GPB’s private placements.

GPB Capital Holdings LLC started in 2013, buying auto dealerships. It reportedly has raised money from approximately 4,000 investors. The GPB Automotive Portfolio reportedly raised $622 million, with a minimum investment of $100,000, and GPB Holdings II reportedly raised approximately $650 million. GPB Capital Holdings reportedly has raised a total of $1.5 billion.

It is believed that brokerage firms Royal Alliance Associates, Inc., Sagepoint Financial, Inc., FSC Securities Corp., Woodbury Financial Services, Inc., Newbridge Securities, Ladenburg Thalmann, and Hightower Securities also sold GPB Capital Holdings Funds.

The brokerage firms and brokers working at those firms were incentivized to sell the GPB funds by commissions rates of nearly 8%. GPB is said to have paid more than $100 million in commissions to brokers and brokerage firms that sold the risky GPB private placements.

According to public reports, trouble for GPB started in 2017 when it sued a former business partner who allegedly reneged on a sale of multiple car dealerships. Among other claims, GPB Capital Holdings sought the return of $42 million it had paid to the former business partner.

Then, in April 2018, GPB Capital Holdings, failed to provide the SEC with required financial reports and a few months later announced that no new investor capital would be accepted. According to public reports, the firm is “straightening out” the accounting for two of its larger funds – GPB Holdings II and GPB Automotive Portfolio.

Shortly after GPB’s announcement, Massachusetts securities regulators announced an investigation into 63 broker-dealers who allegedly sold GPB private placements. GPB’s auditor also recently resigned, citing perceived risks, and securities regulators Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) also have launched independent investigations into GPB Capital Holdings and those broker-dealers that sold GPB Funds.

The Wolper Law Firm represents investors nationwide in securities litigation and arbitration on a contingency fee basis.  Matt Wolper, the Managing Principal of the Wolper Law Firm, is a trial lawyer who has handled hundreds of securities cases during his career involving a wide range of products, strategies and securities.  Prior to representing investors, he was a partner with a national law firm, where he represented some of the largest banks and brokerage firms in the world in securities matters.  We can be reached at 800.931.8452 or by email at mwolper@wolperlawfirm.com.