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GPB Capital Notifies Investors of Independent Monitor But Denies Ponzi Fraud Allegations

SEC Requested Monitor to Protect GPB Fund Investors 

In a letter dated March 3rd, 2021, to all investors of its limited partnerships, CFO and interim CEO of GPB Capital Holdings, Rob Chmiel, notified investors that the firm has consented to a court-appointed independent monitor by the SEC to run the company and oversee its assets.

The regulator said it wanted to protect GPB Fund investors from further financial harm in the wake of the Ponzi fraud charges. 

The SEC pushed for the monitor after filling a civil fraud lawsuit against a number of key GPB Capital parties including: 

  • Founder and former GPB Capital CEO, David Gentile
  • Ex-GPB managing partner, Jeffrey Lash
  • Ascendant Capital owner, Jeffry Schneider
  • The brokerage firm, Ascendant Alternative Strategies

This came in response to the accusation that these key parties were operating an over $1.7B Ponzi scheme that defrauded more than 17,000 investors. Gentile, Lash, and Schneider were arrested in a parallel criminal case. They pleaded not guilty to the charges. 

GPB Capital Holdings continues to deny the fraud allegations. Meanwhile, thousands of investors continue to grapple with losses they sustained from GPB Funds. Dozens of brokerage firms and their registered representatives are believed to have earned more than $160M in commissions from recommending and selling GPB private placements to their customers. 

Our GPB Ponzi Fraud attorneys at Shepherd Smith Edward and Kantas (SSEK Law Firm) at investorlawyers.com) are representing many of these investors in their fight to recoup their losses via Financial Industry Regulatory Authority (FINRA) arbitration. Contact us at (800) 259-9010 today. 

Gardemal Will Have Authority to Approve Major GPB Business Decisions 

In the letter, Chmiel presents the installation of the monitor, Attorney Joseph T. Gardemal III, a Managing Director of Alvarez & Marsal, as a positive development. Chimel said that the alternative asset firm, which invested in auto dealership and waste management, will cooperate with Gardamel in efforts to enhance the value of GPB’s assets and maximize cash flow.

In his role as court-appointed monitor, Gardemal will have the authority to approve or deny key business actions, including those involving huge transactions and substantive changes to business strategies. He also will have access to GPB Capital Holding’s books, records, and account statements. 

Chmiel, who has been and continues to serve as the alternative asset firm’s CFO, was appointed as interim CEO after Gentile stepped down one day after his arrest.  

Experienced Investment Fraud Attorney

Our team of investment fraud attorneys has been working with investors across the United States that have suffered significant investment losses as a result of investing in a GPB private placement. If you believe that your financial advisor or broker-dealer unsuitably recommended these investments for your portfolio, you may have grounds for a FINRA arbitration claim. 

Call (800) 259-9010 or contact us online to speak with an experienced GPB Ponzi Fraud attorney at SSEK Law Firm today.

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