The Scientology Money Project

Breaking News: GPB Audit Committee to Resign; EisnerAmper Suspends Work on Auditing Outstanding Financial Statements

November 23, 2019 — Information confirmed by our sources:

In addition to providing Fund level updates, GPB also provided a significant update on the status of the pending audits being conducted by EisnerAmper. Specifically, “due to the recent events surrounding Michael Cohn, EisnerAmper has suspended their work on outstanding financial statements audits. In addition, the Audit Committee has elected to resign effective upon the earlier date of the completion  of the Rosenberg investigation or by November 27, 2019. Pending the results of the Cohn and the Rosenberg investigations, as well as the reconstitution of the Audit Committee, the Partnership’s auditor will provide further guidance.”

Update:  This is confirmed by the November 22, 2019 letter issued by GPB to its investors:

GPB’s Audit Committee has, or will, resign, no later than Wednesday, November 27, 2019. This is one day before the four day Thanksgiving Holiday in America. The timing is no accident. The resignation of the Audit Committee may well trigger the resignation of EisnerAmper as GPB’s auditor in the very short term. If GPB’s internal Audit Committee resigns, then how does an outside auditor have any confidence to proceed if its client’s own committee does not?

EisnerAmper and GPB’s internal audit team both cited Michael Cohn as an excuse to delay the 2015 and 2016 financials. This is a transparent evasion as Cohn didn’t even begin working at GPB until November 2018.

It seems to us that GPB has looked for any and all excuses to indefinitely delay issuing its revised 2015 and 2016 SEC-required financial statements. These statements were issued and thereafter GPB’s then-auditor withdrew its opinion of the statements. GPB has stonewalled now for two years on these statements. The longer GPB stonewalls, the more it looks like the firm is covering up wrongdoing, Crowe resigned as GPB’s auditor rather than complete these statements. Crowe resigned by stating that GPB fell outside of its risk tolerance parameters. It now appears that GPB has used Michael Cohn’s arrest has as yet another reason to refuse to issue the audited financial statements for 2015 and 2016.

We must ask if the Audit Committee hit a concrete wall called Sarbanes-Oxley and decided to resign en masse in lieu of releasing the 2015 and 2016 audit statements. Sarbanes-Oxley penalties are one of the reasons we can think of for GPB’s two year inability to release 2015 and 2016 statements. There is simply no reason for two outside auditing firms — Crowe and then EisnerAmper — to spend two years working on the 2015 and 2016 financial statements and produce nothing except delays and excuses. GPB had less than $1 billion AUM in this time frame. This is unacceptable and suggests an inherent legal problem because the number crunching isn’t that complex. We’re not talking about a cure for cancer here.

Our opinion is that GPB is choking on the Dibre matter which gave rise to its lawsuit with Dibre. If GPB stated financial data on the assumption that it owned Dibre’s dealerships when it fact Dibre reneged on the transferring the dealerships as alleged by GPB, then that could be where the dead end exists. GPB just commented on the lawsuit and counterclaim between itself and Patrick Dibre:


Michael Cohn was a complete disaster that was self-created and self-inflicted by GPB’s execs. Cohn may prove to be the straw that breaks the camel’s back. As we said, Cohn came in very late to the GPB party and yet was the first to be criminally indicted. For GPB to now claim it is investigating the Cohn matter internally seems specious inasmuch as GPB hired him and issued a press release about his coming onboard. The essence of the press release was that Cohn was a senior and experienced SEC official who had been hired to resolve the pesky compliance issues which had dogged GPB due to its explosive growth. The sense was that there was finally an adult in the room at GPB to handle the heavy lifting of compliance. However, that shore story blew apart when Cohn was indicted. Michael Cohn allegedly leaking details of the Federal criminal investigation of GPB to GPB executives is an extremely serious matter.

GPB issued two letters to its “Valued Partners” on November 22, 2019. We furnish them below in PDF form:

1. GPB Automotive Portfolio — Fair Market Value, November 22, 2019: Note: Please hover your cursor over the document to invoke the page up/page down controls at the bottom of the page frame:

2. GPB Holdings II- Fair Market Value, November 22, 2019. Note: Please hover your cursor over the document to invoke the page up/page down controls at the bottom of the page frame:





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