GPB Capital Funds

GPB Automotive Portfolio, LP Files 10-Q with SEC; Future Remains Uncertain for GPB Automotive Investors

Published on: November 15, 2021 | by Iorio Altamirano

Between July 2013 and June 2018, limited partners invested $675 million into GPB Automotive Portfolio, LP, which was sold as a private placement offering by broker-dealers and registered investment advisory firms across the country. Financial advisors, who received large commissions for selling limited partnership units of GPB Automotive, lured investors into this high-risk and illiquid security by emphasizing a high rate of return and monthly distributions. Unfortunately for investors, distributions have not been paid since December 2018.

With the recent announcement that GPB Automotive Portfolio, LP agreed to sell Prime Automotive for $880 million, limited partners have been wondering what that means for them.

Below, we delve into GPB Automotive LP’s latest quarterly filing with the SEC to look for answers.

Iorio Altamirano LLP Files GPB Automotive Claim Against Aegis Capital Corp

Published on: November 11, 2021 | by Iorio Altamirano

Iorio Altamirano LLP, a leading securities arbitration law firm, has filed a case through the Financial Industry Regulatory Authority (FINRA) Dispute Resolution Services’ arbitration forum against Aegis Capital Corp.

The claim, which Iorio Altamirano LLP filed on behalf of an investor in the GPB Automotive Portfolio, LP fund, seeks to recover investment losses as a result of the investment advisor’s recommendation to invest in GPB Capital.

GPB Capital sold unregistered and high commission limited partnership interests in a total of eight alternative-asset investment funds. The GPB Funds were marketed to independent broker-dealers and investment advisers who would, in turn, sell the GPB Funds to their retail investors. There are serious concerns that broker-dealers may have failed to conduct reasonable due diligence about the GPB Funds and GPB Capital.

Aegis Capital Corp. Ordered to Pay Nearly $2.7 Million for Supervisory Failures Related to Rampant Excessive and Unsuitable Trading

Published on: November 9, 2021 | by Iorio Altamirano

On November 8, 2021, the Financial Industry Regulatory Authority (“FINRA”) and Aegis Capital Corp. (“Aegis Capital”) entered into Letter of Acceptance, Waiver, and Consent No. 2016051704305 (the “AWC”). After conducting an investigation, FINRA alleged in the AWC that from July 2014 through December 2018, Aegis Capital failed to establish, maintain, and enforce a supervisory system, including written supervisory procedures (WSPs), reasonably designed to achieve compliance with the suitability requirements of FINRA Rule 2111 as it pertains to excessive trading. As a result, Aegis Capital failed to identify trading in hundreds of customer accounts that were potentially excessive and unsuitable, including trading conducted by eight Aegis Capital registered representatives in the firm’s Melville and Wall Street branches whose trading in the accounts of 31 firm customers resulted in an average annualized cost-to-equity ratio (or break-even point) of 71.6%, an average annualized turnover rate of 34.9, combined customer costs (including commissions, markups or markdowns, margin interest, and fees) of more than $2.9 million, and cumulative losses of $4.6 million.

Additionally, the FINRA AWC alleged from July 2014 to June 2019, Aegis Capital failed to establish, maintain, and enforce a supervisory system, including WSPs, reasonably designed to achieve compliance with the suitability requirements of FINRA Rule 2111 when selling leveraged, inverse, and inverse-leveraged Exchange-Traded Funds (Non-Traditional ETFs) to retail customers. As a result, Aegis Capital failed to identify customers who purchased and held Non-Traditional ETFs for extended periods of time or whose purchase was inconsistent with their recorded investment objective, risk tolerance, or finances.

Customers of Aegis Capital, including customers that have been notified that they may be receiving restitution, should consult with a securities arbitration law firm. If you or a loved one were a customer of Aegis Capital, contact New York securities arbitration law firm Iorio Altamirano LLP for a free and confidential consultation and review of your legal rights.

GPB Capital Founder Seeks Millions in Distributions from Fund Investors That He Allegedly Defrauded

Published on: October 7, 2021 | by Iorio Altamirano

David Gentile, the disgraced founder of GPB Capital Holdings LLC, who is facing criminal and civil fraud charges, is seeking to obtain millions of dollars from GPB. Despite being accused of running a Ponzi-like scheme when he was running GPB Capital, Mr. Gentile is asking for court-supervised mediation to obtain a distribution of more than $5 million to cover his personal tax liability from last year. Meanwhile, limited partners of GPB Capital private placement funds, such as GPB Automotive Portfolio LP, have not received distributions since 2019. Worse, their investments remain illiquid, as there is no secondary market to sell their units.

Mr. Gentile claims to be “entitled to distributions” under the private equity firm’s operating agreements. He also claims that GPB Capital and its funds, including GPB Holdings, LP / GPB Holdings Qualified, LP, GPB Automotive Portfolio, LP, GPB Holdings II, LP, and GPB Waste Management, LP, are responsible for paying his legal fees. He is essentially asking investors who have been defrauded to pay his legal fees to defend him against numerous allegations of wrongdoing.

Lawyers for the U.S. Securities and Exchange Commission (SEC) argue that Mr. Gentile’s request should be denied because he does not qualify for mediation according to rules issued by the court.

Iorio Altamirano LLP Files GPB Automotive Claim Against American Capital Partners

Published on: October 4, 2021 | by Iorio Altamirano

Iorio Altamirano LLP, a leading securities arbitration law firm, has filed a case through the Financial Industry Regulatory Authority (FINRA) against American Capital Partners.

The claim, which Iorio Altamirano LLP filed on behalf of an investor in the GPB Automotive Portfolio, LP fund, seeks to recover investment losses as a result of the investment advisor’s recommendation to invest in GPB Capital.

GPB Capital sold unregistered and high commission limited partnership interests in a total of eight alternative-asset investment funds. The GPB Funds were marketed to independent broker-dealers and investment advisers who would, in turn, sell the GPB Funds to their retail investors. There are serious concerns that broker-dealers may have failed to conduct reasonable due diligence about the GPB Funds and GPB Capital.

GPB Automotive Portfolio, LP to Sell Prime Automotive for $880 Million, Which Generated $1.8 Billion in Annual Revenue in 2020; GPB Automotive’ s Future Remains Uncertain

Published on: September 14, 2021 | by Iorio Altamirano

According to SEC filings, GPB Automotive Portfolio LP entered into an agreement with Group 1 Automotive, Inc. on September 12, 2021, to sell Prime Automotive for $880 million, consisting of 30 car dealerships and three collision centers located in the Northeast of the United States. According to a press release issued by Group 1 Automotive, Inc., the Prime Automotive dealerships generated $1.8 billion in annual revenues in 2020.

The future of GPB Automotive Portfolio, LP remains uncertain. Investors of GPB Automotive Portfolio LP are encouraged to act now and contact a securities arbitration law firm for a free consultation and review of their legal rights.

Iorio Altamirano LP is a securities arbitration law firm that represents GPB Automotive investors.

GPB Automotive Portfolio, LP to Sell Prime Automotive as Its Future Remains Uncertain; Investors Encouraged to Act Now

Published on: August 24, 2021 | by Iorio Altamirano

August 24, 2021 – This morning, investors of GPB Automotive Portfolio LP woke up to more worrisome news, as the Wall Street Journal reported that the GPB Capital Holdings LLC, is looking to sell its largest dealership group, Prime Automotive, raising speculation that the GPB Automotive is running out of cash.

The latest news follows GPB Automotive’s regulatory filings in May 2021 that disclosed that there was substantial doubt that the business would survive, and July 2021 that disclosed that the Partnership was able to obtain a financing agreement with M&T Bank, but that the Partnership only had sufficient liquidity to meet its financial obligations through July 21, 2022.

In its latest regulatory filing, on August 16, 2021, GPB Automotive disclosed that it might sell dealerships to provide operational liquidity. According to the Wall Street Journal, such sales may be priced below fair value and go on the book as losses.

GPB Capital Investor Recovers Full Investment Through FINRA Arbitration Award

Published on: August 16, 2021 | by Iorio Altamirano

On August 13, 2021, a FINRA arbitration panel in New York, New York, ruled in favor of a brokerage customer that invested in GPB Automotive Portfolio LP and GPB Waste Management LP at the recommendation of his financial advisor at Hightower Securities, LLC.

The arbitration panel ordered Hightower Securities, LLC to refund $163,201 to the customer in exchange for a return of the limited partnership interests, essentially making the customer whole. The customer had purchased the limited partnership interests for $170,000 and had previously received $6,799 from the investments as a return of capital.

Iorio Altamirano LLP is investigating claims on behalf of defrauded investors who were victims in the GPB funds scheme. The GPB funds were marketed to independent broker-dealers and investment advisers who would, in turn, sell the GPB funds to their retail investors.

Iorio Altamirano LLP Investigates American Capital Partners, LLC Over GPB Capital Funds

Published on: August 12, 2021 | by Iorio Altamirano

American Capital Partners, LLC is a broker-dealer headquartered in Hauppauge, New York. According to publicly available records filed with the SEC, the firm likely received sales compensation for selling the GPB Automotive Portfolio, LP to retail investors. Upon information and belief, broker Frank Palumbo was one of the financial advisors at American Capital Partners, LLC’s that recommend GPB Automotive Portfolio, LP to retail customers.

Iorio Altamirano LLP is investigating claims on behalf of defrauded investors who were victims in the GPB Capital funds scheme. The GPB Capital funds were marketed to independent broker-dealers and investment advisers who would, in turn, sell the GPB funds to their retail investors.

Customers who have invested in GPB Automotive Portfolio, LP with American Capital Partners, LLC, should contact securities arbitration law firm Iorio Altamirano LLP for a free and confidential consultation and to review their legal rights.

GPB Automotive Portfolio, LP’s Latest Public Filing Raises Doubts That the Business Will Survive; Investors Should Contact an Attorney to Review Legal Rights

Published on: May 18, 2021 | by Iorio Altamirano

On Friday, May 14, 2021, GPB Capital Holdings LLC (“GPB Capital”), a private equity firm based in New York, registered some units in its GPB Automotive Portfolio, LP (“GPB Automotive”) with the Securities and Exchange Commission. As part of its filing, GPB Automotive disclosed that it had substantial doubt of its ability to continue operations. Specifically, GPB Automotive made the following risk factor disclosures to investors and potential investors:

We have determined that there is substantial doubt as to our ability to continue as a going concern, due to the expiration of the credit facility for the majority of our dealerships within 12 months, as well as certain other factors. Our inability to extend the maturity of our credit facility, or replace the credit facility, prior to its maturity in February 2022 would materially adversely affect our financial condition, results of operations, cash flows and business operations.
We may not have adequate funds to complete future capital improvement programs or to make additional acquisitions.