Super Lawyers
AVVO
Million Dollar Advocates Forum
Martindale-Hubbell
BBB Accredited Business

Attorney Investigation: GPB Holdings Accused of Being a Ponzi Scheme By Former Operating Partner

GPB HoldingsFitapelli Kurta, a New York city based law firm, is investigating claims against GPB Holdings related to recent allegations that the fund is operated as ponzi scheme.  These allegations were asserted against GPB Holdings by a former operating partner, Patrick Dibre, in a counterclaim filed in New York State Supreme Court. If you or someone you know invested in a fund offered by GPB Capital Holdings, please contact our office for a free confidential consultation.

                A former business partner of GPB Holdings, Patrick Dibre, recently filed a counterclaim against GPB in New York State supreme court, alleging that, “losses occasioned by GPB were in fact caused by a very complicated and manipulative Ponzi scheme.”  Mr. Dibre’s lawsuit with GPB Holdings concerns a dispute regarding the purchase of various car dealerships.  His counterclaim against GPB Holdings further alleges that, “GPB paid its investors significant returns based upon falsified financial information.”  The complaint also alleges that GPB, in order to generate the high dividends that it promised to investors, had to “implement a different investment methodology than the one disclosed to the investors.”  These allegations, if proven true, are incredibly serious and could pose a significant risk to investors in GPB Holdings.

                The allegations concerning financial fraud, according to Dibre’s complaint are as follows:

  • The principals of GBP allegedly “recorded the purchase price of the dealerships that they purchased from Dibre at several million dollars more than the combined actual purchase price, closing expenses and working capital investment.”
  • GPB would transfer funds between related companies “in order to bolster returns if a fund was lagging behind.”
  • A family member of one of the owners of GPB Capital Holdings, was hired to perform monthly accounting services. The claim alleges that the services were “either never performed or which were over billed in the approximate amount of $100,000 per month.”
  • The principals of GPB expensed significant personal items, such as luxury cars, vacations and private jets.
  • GPB “manipulated the financial statements of dealerships and the GPB funds to hide their activities.”

                On March 29, 2018 investors in GPB Holdings and GPB Holdings Qualified notified investors that the general partner has elected to decrease its distributions to 4.00% and 3.5%, respectively, for its two funds.  Although the reduction in distributions has been characterized as “temporary,” GPB’s correspondence to investors does not indicate when regular distributions will commence.  According to GPB’s notification to investors the decision to decrease distributions is directly related to the litigation with Mr. Dibre, which involves allegations that GPB may be a ponzi scheme.  GBP’s March 29, 2018 letter does not address the allegations raised by Mr. Dibre that GPB may be a ponzi scheme.

GPB Capital Holdings is a sponsor of alternative, illiquid private placements, which are sold through a network of independent broker-dealers.   Like most illiquid private placements, the commissions for GPB’s products are considerably higher than conventional investment products (i.e. a blue-chip stock or municipal bond).   In fact, according to published reports, one of GPB’s recent offerings charged 11.75%, in sales commissions, which included 7% to the broker as well as a variety of other costs and fees.    The allegations raised against GPB Holdings are extremely serious.  If you or someone you know invested in GPB Holdings, please contact us immediately for a free and confidential consultation.  You can call 212-658-1500 or email info@fkesq.com.

Contact Information