Articles Tagged with GPB fraud attorney

shutterstock_143179897-300x300The law offices of Gana Weinstein LLP continue have represented over 100 investors defrauded in GPB Capital relating investments.  For nearly two years our firm has been filing complaints against the brokerage firms that wrongfully sold these products alleging that GPB Capital has all the tell-tale signs of being a scam.  On February 4, 2021 the U.S. Securities and Exchange Commission (SEC), the U.S. Attorney’s Office for the Eastern District of New York (DOJ), and seven states filed separate simultaneous actions against GPB Capital and other defendants connected to the firm accusing it of being a Ponzi-like scheme.  In a press release the SEC stated that it “charged three individuals and their affiliated entities with running a Ponzi-like scheme that raised over $1.7 billion…”[1]

As reported by Bloomberg “If proved, [GPB] would be one of the largest such schemes to target individual investors since the massive frauds of Bernard Madoff and Robert Allen Stanford came to light.”[2]  The DOJ indicted David Gentile, the founder of GPB, Jeffry Schneider, the owner and CEO of Ascendant Capital LLC, and Jeffrey Lash, a former managing partner of GPB relating to the fraud.  If convicted, the defendants each face up to 20 years’ imprisonment.[3]  New York Attorney General Letitia James accused GPB of “defrauding investors across the country out of more than $700 million through a Ponzi-like scheme that offered to pay investors generous monthly distributions they could never deliver.”[4]  Further, “Investors put in more than $1.8 billion into GPB funds but were left without a single cent of profit,” said Attorney General James.  The fraud was alleged to have been carried out by “failing to disclose numerous conflicted transactions involving related parties, as well as misappropriations of fund assets, all of which served to benefit” GPB and its owners.

Where did investor money go? “Investor funds were spent to subsidize private planes and luxury travel for the three defendants, direct payments totaling millions of dollars into personal bank accounts, and payments to family members. Defendant Gentile even purchased a Ferrari sports car with investor funds.”  Id. Continue Reading

shutterstock_102242143-300x169Advisor Jeffrey Dixson (Dixson), currently employed by Madison Avenue Securities, LLC (Madison Avenue) has been subject to at least seven customer complaints and one regulatory action during the course of his career.  According to a BrokerCheck report the customer complaint concerns alternative investments such private placements and direct participation products (DPPs) like non-traded real estate investment trusts (REITs), oil & gas programs, annuities, and equipment leasing programs.  The attorneys at Gana Weinstein LLP have represented dozens of investors who suffered losses caused by these types of high risk, low reward products.

One private placement that a large number of clients of Madison Avenue were sold is GPB Capital Holdings (GPB Capital) related investments.  GPB Capital is facing multiple accusations of being a Ponzi scheme, an ongoing U.S. Securities and Exchange Commission (SEC) and FBI investigations, and even GPB’s chief compliance officier being indicted for illegally obtaining information on the SEC’s investigation.  Now even Volkswagen and Toyota are threatening to pull the plug on GPB Capital auto dealerships.  While advisors have been telling investors to do absolutely nothing and just hang in there – this is nothing more than just additional poor advice.  In November 2019 GPB Capital’s admitted that no financial audit would occur anytime in the near future.  In sum, investors now know there is nothing to hang onto.  By the day, advisor recommendations to do nothing appear to be completely self-serving, out of the loop, and not in the interest of the investor.

In November 2019 a customer complained that Dixson violated the securities laws by alleging that Dixson engaged in sales practice violations related to investments made between 2016 to the present in various alternative investments and fixed index annuities that were alleged as unsuitable. The allegations include Oregon Securities Law, breach of fiduciary duty, negligence and elder abuse.  The claim alleges $150,000 in damages and is currently pending.

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shutterstock_186772637-300x199Our firm has been contacted by hundreds of clients that have been defrauded in GPB Capital Holdings (GPB Capital) related investments.  One common element in our firm’s contact with GPB Capital investors is the advisor’s recommendation to victims – do absolutely nothing.  The advisors recommendation is expressed in phrases like “the audits will come out”, “GPB Capital is a completely transparent company and not a scam”, and sometimes “just hang in there.”

However, in November GPB Capital’s patience game crumbled and the firm admitted that no financial audit would occur anytime in the near future.  In sum, investors now know there is nothing to hang onto.  Advisors have no counter talking points to weigh against multiple accusations of being a Ponzi scheme, the ongoing U.S. Securities and Exchange Commission (SEC) and FBI investigations, and even GPB’s chief compliance officer being indicted for illegally obtaining information on the SEC’s investigation.  Now even Volkswagen and Toyota are threatening to pull the plug on GPB Capital auto dealerships.  By the day, advisor recommendations to do nothing appear to be completely self-serving, out of the loop, and not in the interest of the investor.

Our firm has analyzed the GPB Capital offerings and believe that brokerage firms did not review GPB Capital offerings in any significant detail.  Any serious due diligence would have revealed that GPB Capital was a dubious offering destined to fail.  In complaints filed with The Financial Industry Regulatory Authority (FINRA) our clients have alleged that GPB Capital’s scam was highly predictable and easy to spot.  Nearly every aspect of the offering raised unanswerable questions from GPB Capital’s senior management, fantastical business claims, and intra-fund lending practices.

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shutterstock_168478292-300x222Our firm represents multiple clients who have collectively lost millions in the sale of fraudulent GPB Capital Holdings (GPB Capital) related investments.  Our firm has analyzed the GPB Capital offerings and believe that brokerage firms did not review these offerings in any significant detail.  Any serious due diligence would have revealed that GPB Capital was an investment fraud scheme.

Advisor Robert Smith (Smith), according to BrokerCheck records kept by The Financial Industry Regulatory Authority (FINRA), has been accused of selling GPB Capital.  Smith is currently registered with member firm Concorde Investment Services, LLC (Concorde Investment).  In addition, Smith disclosed four total customer complaints. If you have been a victim of Smith’s alleged misconduct our firm may be able to assist you in recovering funds.

Our firm’s investigation has found that brokerage firms failed to conduct due diligence and investigate multiple aspects of GPB Capital’s business including its senior management, fantastical business claims, and intra-fund lending practices.  For instance, with respect to GPB Capital’s senior management the company 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.   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.”).

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