Fort Lauderdale, FL (Law Firm Newswire) June 19, 2019 - The Wolper Law Firm is currently investigating potential claims against various brokerage firms that received a total of $100 million in commissions by recommending their clients invest in private placement securities issued by GPB Capital Holdings.
GPB Capital Holdings, LLC is a New York based alternative asset management firm that started in 2013. Initially, the company accepted investments from 4,000 investors, receiving hundreds of millions of dollars in capital. In addition, GPB Capital Holdings encouraged brokerage houses to recommend its products by offering lucrative commissions, up to nearly 8 percent of the investment amount. In total, GPB Capital Holdings took in $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.
GPB Capital Holdings invested through a variety of different private placements, including the following:
· GPB Automotive Portfolio, LP
· GPB Cold Storage, LP
· GPB Eurobond Finance PLC
· GPB Holdings II, LP
· GPB Holdings, III, LP
· GPB Holdings Qualified, LP
· GPB Holdings, LP
· GPB NYC Development
· GPB Scientific, LLC
· GPB Waste Management, LP formerly: GPB Waste Management Fund, LP.
In 2017, GPB Capital Holdings was involved in a dispute with a former partner, who allegedly reneged on an agreement to sell several car dealerships. GPB Capital Holdings filed several claims against the former partner, among them a claim for $42 million. In the course of litigation, the former partner explained that GPB Capital Holdings is nothing more than a “very complicated and manipulative Ponzi scheme.”
In 2018, GPB Capital Holdings failed to file necessary financial reports with the Security and Exchange Commission (SEC). Shortly after that, the company announced that it was no longer accepting new investments and that it was “straightening out” the accounting for two of its larger funds – GPB Holdings II and GPB Automotive Portfolio. Amidst this uncertainty, the company’s auditor resigned, citing perceived risks.
These issues prompted several regulatory authorities, including the Financial Industry Regulatory Authority (FINRA) and the SEC, to look into GPB Capital Holdings. In addition, an investigation is pending into the 63 broker-dealers that sold private placements by GPB Capital Holdings. As a result of these investigations, investors stand to lose significant capital, including their principle investment. The brokerage firms that recommended private placement securities that were issued by GPB Capital Holdings may not have conducted the necessary due diligence before recommending these products and may be liable for investors’ losses.
The Wolper Law Firm represents investors nationwide in securities litigation on a contingency fee basis. Matt Wolper, the Managing Principal of the Wolper Law Firm, is a veteran trial lawyer who has handled hundreds of securities cases during his career. The Wolper Law Firm can be reached at 800.931.8452 or at https://wolperlawfirm.com/
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