The day of reckoning has come for broker-dealers who sold unsuitable GPB Capital investments to investors in the Northeast. After raising as much as $1.5 billion from investors, GPB Capital, stockbrokers who sold GPB investments, and brokerage firms have since come under scrutiny for a lack of transparency and for failing to do their due diligence in researching the investment opportunity.
More than 60 brokerage firms, including Woodbury Financial Services, Inc.; Sagepoint Financial, Inc.; Kalos Capital, Inc.; FSC Securities Corp.; Arkadios Capital; and Royal Alliance Associates, Inc., among others, have all been accused of selling bad investments after investors were assured that their principles were secure and that private placements in GPB would result in returns for years to come.
Private Placements by GPB Capital
Investors were under the impression that these assets were strong and that GPB was buying waste-management businesses and auto dealerships. Investors then would instruct their broker-dealers to conservatively invest their inheritances and savings, only to find that their hard-earned money went to illiquid investments and high-risk private placements.
The private placements of GPB Automotive Portfolio raised over $622 million, while GPB Holdings Ⅱ raised nearly $646 million in investment funds. Adding insult to injury, GPB Capital failed to register said funds with the U.S. Securities and Exchange Commission (SEC) and continues to be more than one year overdue for registration, as of the writing of this article.
Both the Federal Bureau of Investigation (FBI) and the SEC have begun investigations into the business practices of GPB, while GPB maintains no wrongdoing and has told investors they are currently auditing their investment funds.
The Pursuit of FINRA Arbitration Claims
Some investors who have suffered investment losses as a result of these private placements and illiquid alternative investments have already begun to file arbitration claims with the Financial Industry Regulatory Authority (FINRA) against the broker-dealers who sold them the unsuitable investments in the hopes of recovering their investment losses.
Royal Alliance investors, for example, have already lost more than $1 million for one investor, while SagePoint Financial, Inc. has become the subject of a $400,000 FINRA claim. Individuals who have discovered similar investment losses involving GPB Capital can follow suit by initiating FINRA arbitration claims with the assistance of a highly trained investment loss attorney.
This can provide wronged investors with the opportunity to hold GPB Capital, and the brokerage firms and dealers who sold these private placements, to account, as well as the potential to recover their significant investment losses.
Contact a Qualified FINRA Lawyer
If you are an investor who has purchased investments in GPB Capital and has suffered significant losses as a result of these unsuitable investments, consult with an experienced FINRA arbitration lawyer at Meissner Associates.
We offer complimentary consultations to investors who have been subject to investment losses by unscrupulous broker-dealers. You can take advantage of this opportunity and schedule your confidential claim review by submitting the brief contact form provided to the right or by giving our firm a call at 212-764-3100.