Meyer Wilson Attorney Courtney Werning and our team recently secured a FINRA arbitration victory for a client who lost money investing in GPB Capital Holdings at the recommendation of his broker and investment adviser at Hightower Securities.
Following a weeklong evidentiary hearing in New York City, the NYC FINRA arbitration panel ordered Hightower to take back the now-defunct GPB funds and pay the Claimant $163,201 in damages, the full amount of his investment losses.
Our client, represented jointly by Meyer Wilson and Peiffer Wolf Carr Kane & Conway, was sold $170,000 of GPB Capital funds at the recommendation of his broker and adviser at Hightower, despite such investments not being fit for any investor. GPB was eventually exposed as a Ponzi scheme.
As Attorney Courtney Werning notes:
“[w]e presented an abundance of evidence during the final hearing that Hightower failed spectacularly in its due diligence obligations regarding GPB Capital. What Hightower should have known about GPB from the beginning should have precluded it from selling any of the GPB funds to any investor. This case sends an important message to Hightower and all the brokerage firms that raked in enormous commissions for selling investments that were clearly not fit to be sold to anyone.”
GPB ran a Ponzi scheme that raised $1.8 billion in capital selling private placement securities that invested in automotive dealerships, the waste management industry, and middle market lending – a large portion of which was siphoned into the pockets of GPB principals and brokerage firms like Hightower that sold unsuitable private investments to their clients.
GPB CEO David Gentile and others involved in the scheme have been criminally charged with securities fraud.