GPB Capital Holdings, which reportedly collected $1.5 billion from individual investors through the sale of very high-risk private products, is involved in another legal dispute, this time with Volkswagen’s control of VW’s dealerships purchased by GPB Capital.
This week Volkswagen filed an amended complaint against GPB Capital, alleging that GPB breached an agreement with VW last September when GPB Capital removed David Rosenberg as head for 3 VW dealerships.
Last July, Rosenberg filed claims against GPB in Massachusetts, alleging that the GPB engaged in severe financial misconduct and attempted to push him out after making a complaint to the Securities and Exchange Commission (SEC).
When GPB Capital terminated Rosenberg, Volkswagen insisted that GPB divest from VW dealerships. The claim is now in private arbitration.
Last month, GPB transferred the matter to private arbitration. According to the claim, GPB hired Mr. Rosenberg at the end of 2017 to operate a portfolio of motor vehicle dealings.
The lawsuit was filed this week in US District Court in New York seeks a declaratory judgment with GPB to regain the control of 3 VW dealerships. Bystanders are seeing this as a way for Volkswagen to distance themselves from GPB Capital.
Growing GPB Capital Legal Issues
The legal problems of GPB Capital keep piling on. GPB is under investigation by the FBI and the SEC. They have failed to provide audited financial statements for its funds. Just last month they sent a letter to investors saying GPB would try to get the tax form Schedule Ds to investors by July.
As a result, most investors are unaware of the value of GPB funds. Many have filed lawsuits to recover their losses.
According to Matthew Thibaut, Haselkorn & Thibaut (InvestmentFraudLawyers.com), “… none of this reflects positively on GPB, not the auditor withdrawal, not the pending litigation, not the ongoing state and federal investigations, and certainly not when a recently hired Chief Compliance Officer is charged with alleged wrongdoing including obstruction of justice.”
Thibaut’s firm has opened a hotline for GPB Capital investors to call for a free review of their portfolio. Please visit www.InvestmentFraudLawyers.com or call 1-888-628-5590 to speak privately to a securities attorney to learn about your legal options.
Last October the Department of Justice charged Michael S. Cohn, Managing Director and Chief Compliance Officer of GPB Capital, with obstruction of justice, unauthorized computer access, and disclosure of unauthorized confidential information.
GPB Capital Investigations
Unfortunately for investors, GPB Capital is at the heart of numerous other legal actions involving claims of fraud and operating a Ponzi-like scheme.
For over 2 years GPB Capital has also allegedly been under investigation by FINRA, SEC state and federal authorities for potential securities law violations or other improprieties. The FBI also made an unannounced search of the GPB Capital offices last February.
Investment insiders are “waiting for the shoe” to fall and are expecting more bad news for GPB Capital. This is extremely horrible news for the thousands of people that invested with them.
All investment have risks. However, private placements like GPB Capital are generally very risky. Investors should be extremely cautious about making investments that are not actively traded on the exchanges.