David Gentile
Talk about hubris!
GPB Capital Holdings was excoriated in the media in July 2020 for taking $8 million in PPP loans even as it was at the center of an FBI criminal investigation and was the target of numerous class action lawsuits alleging securities fraud. The New York Times took GPB Capital to task over PPP loans along with televangelist Jim Bakker, Olivet University, and other scofflaws.
In February 2021, GPB Capital Holdings was sued by the SEC and eight US State Attorneys General for securities fraud and other causes of action. GPB Capital’s owner David Gentile and his two associates Jeffry Schneider and Jeff Lash were arrested by the FBI and charged with multiple felonies.
Signature Bank, which had loaned GPB Capital $2.2 million in PPP loans, acted swiftly to protect itself by taking the money back. Signature Bank cited the arrests of Gentile and his co-defendants and declared the loan to be in default.
GPB Capital Holdings — which has bilked $1.8 billion from its investors — played the aggrieved victim and sued Signature Bank for the return of the $2.2 million in PPP money. GPB dramatically claims in its lawsuit that it will be irreparably harmed if the $2.2 million PPP loan money is not immediately returned.
One potential risk here is that Signature Bank can counterclaim and seek to prove that GPB Capital is the alter ego of David Gentile and Jeffry Schneider. Once an alter-ego allegation is proven, and it should be fairly easy to do, the GPB lawsuit can be dismissed. An alter-ego finding in a civil court can also be cited in the US Federal criminal trial against Gentile and Schneider.
Another problem: GPB Capital hired the NYC firm Risa Heller Communications to be its crisis management expert. In the middle of its epic PR and legal crisis, however, GPB has filed a lawsuit seeking to claw back taxpayer-funded PPP loans. This makes GPB look truly venal and sleazy given that its principals have been arrested by the FBI, charged with numerous felonies, and David Gentile used investor money to buy himself a Ferrari, a private jet, a yacht, and to indulge in every possible luxury including the purchase of multiple homes in the Hamptons, Florida, New York, and Oregon.
As legal records show, Gentile stuck Bob’s Buick — one of GPB’s automotive dealerships — with the $335,000 bill for the Ferrari. The supercar was later sold at a loss in what appears to be a sweetheart deal. Investors paid for the Ferrari and that money is gone. Gentile cons investors for cash, but the second a bank takes money from him he runs to court like a whiny little bitch and claims irreparable harm. David Gentile has learned well the greedy, self-serving, and hypocritical ways of Scientology.
The lawsuit:
Categories: The Scientology Money Project
One potential risk here is that Signature Bank can counterclaim and seek to prove that GPB Capital is the alter ego of David Gentile and Jeffry Schneider. Once an alter-ego allegation is proven, and it should be fairly easy to do, the GPB lawsuit can be dismissed. An alter-ego finding in a civil court can also be cited in the US Federal criminal trial against Gentile and Schneider.
Another problem: GPB Capital hired the NYC firm Risa Heller Communications to be its crisis management team. In the middle of an epic crisis, GPB has filed a lawsuit seeking to claw back taxpayer-funded PPP loans. This makes GPB look truly venal and sleazy given that its principals have been arrested by the FBI and charged with numerous felonies.
How can Risa Heller help GPB Capital now that it has filed an ill-considered lawsuit that only serves to anger the American taxpaying public?
This is going to be a bit of an uphill battle for Gentile (read: lost cause). Basically, banks have fairly wide latitude to protect their interests in loans. I would have to believe that the law is on their side, regardless of whether GPB Capital is actually charged criminally along with the individuals in the criminal case.
Essentially, the various legal actions against the firm suggest that GPB was a fraud from the very beginning. It’s probably not a situation where a couple of guys started out with good intentions and then got in over their heads and made some mistakes later on.
This suit may be an attempt by Gentile and his alleged co-conspirators to deflect blame for the final collapse of GPB onto the bank and to distract from the far more direct responsibility that they had for its demise. “And I would have gotten away with it, too, if it weren’t for you meddling bankers!” said every “Scooby Doo” villain ever. So they may basically be just playing to make it harder for their investors to make a claim on their personal assets.