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Start a Ponzi, Buy a Ferrari

Modena, Italy - November, 2019. Side view of a Ferrari 812 Superfast

February 8, 2021

The SEC and New York State are suing GPB Capital Holdings and three executives, alleging that they defrauded more than 17,000 retail investors in a Ponzi scheme that raised over $1.7 billion. The suit claims the three used investors’ funds to pay out monthly distributions to new investors instead of putting them toward investments, while telling the marks that their 8 percent monthly distributions were fully covered by profits. They backed their claims with allegedly falsified financial statements and back-dated performance sheets. Millions of dollars of the investors’ money was funneled into personal and family bank accounts, and spent on private planes, luxury travel. One of the accused bought a Ferrari. “GPB denies these allegations and intends to vigorously defend itself in court where, for the first time, the firm will be able to present significant evidence in its favor,” the company said in a statement.

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