Embattled private fund adviser GPB Capital says it will not be able to publish its financial reports by the year’s end and that the company’s audit committee has resigned.
The company is blaming its latest problems on the indictment of its CCO, Michael Cohn, a former SEC official accused of trading sensitive details of ongoing federal investigations into GPB (RCW, Oct. 31, 2019), letters obtained by Regulatory Compliance Watch show.
But the company has been under steady siege since April 2018, when it missed a Commission deadline to file its financial reports. In separate letters to investors in its GPB Automotive Portfolio and GPB Holdings II, the company says it has “engaged a third-party law firm to perform an independent investigation of the allegations related to Michael Cohn’s hiring and employment.”
GPB co-founder and CEO David Gentile declined our request for an interview, and his spokeswoman declined to comment on this story.
Internal investigation
The letters also refer to an internal investigation into accusations made by one of its executives, David Rosenberg, who was fired as CEO of GPB’s Prime Automotive Group in September, just two months after filing a lawsuit in Massachusetts alleging financial misconduct at the funds.
The GPB scandal threatens to affect some broker-deals, too: lawsuits are already working their way through federal courts alleging that broker-dealers such as Axiom and Ascendant Alternatives mailed in their due diligence at the promise of GPB’s high commissions—up to eight percent in some cases.
Officials at those companies didn’t respond to requests seeking comment.
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