Blog: Scientologist-Owned GPB Capital Holdings Hit With Yet Another Lawsuit Alleging Serious Financial Misconduct - 2019-07-27
An article in the Boston Globe by correspondent Allison Hagan presents the details of a new lawsuit against GPB Capital, the troubled New York City private equity firm owned by Scientologist David Gentile. GPB's investors were shocked after GPB was raided by the FBI earlier this year. Investors were then staggered to their core when GPB was forced last month to announce the devaluation of its holdings from $1.8 billion to $1.1 billion. $700 million in investor money is gone.
GPB Capital now faces what we consider a blockbuster lawsuit filed by GPB insider David Rosenberg, the CEO of Prime Automotive Group. GPB purchased a passive majority interest in Prime in 2017 for $235 million plus future monies to be paid on a call option. Rosenberg's lawsuit contains a wealth of details about the alleged inner workings of GPB Capital.
Located in Massachusetts, Prime Automotive is the largest car dealership in New England with annual sales of $3.2 billion according to reports. However, according to the lawsuit, the value and viability of the dealerships is threatened by GPB's "massive" financial misconduct. Claims of self-dealing, kickbacks, and lavish management fees Gentile paid himself and others in his inner circle from investor funds are just part of the lawsuit.