The Department of Justice has charged Michael Cohn, former Chief Compliance Officer of GPB Capital Holdings, for stealing information related to an SEC investigation.
The U.S. Attorney’s Office for the Eastern District of New York charged Cohn with obstruction of justice, unauthorized computer access, and unauthorized disclosure. Cohn pled not guilty to those charges at a federal court in Central Islip, NY on October 23, 2019.
Cohn previously worked at the SEC as an examiner in the Enforcement Division. In October 2018, Cohn left the SEC to join GPB. According to the criminal charges, Cohn illicitly accessed information on SEC servers about the SEC’s investigation into GPB. The highly sensitive material accessed by Cohn included confidential information and privileged attorney work-product information. In the course of being hired, Cohn allegedly told GPB that he had inside information about the SEC’s investigation. In addition, Cohn passed information he obtained from the SEC to GPB senior management.
“When Cohn left the SEC to join GPB, he left with more than his own career ambitions. The proprietary information he allegedly retrieved—from databases he wasn’t authorized to access—included compromising information about a GPB investigation and sensitive details related to the same. The charges announced today demonstrate the FBI’s commitment to protect the securities industry, in addition to guarding the confidential information that is essential to the success of our investigations,” William F. Sweeney, Jr., FBI Assistant Director-in-Charge, told the press.
At his arraignment, Cohn was released on a $250,000 bond. Cohn could face more than 25 years of imprisonment if he is found guilty on all three charges.
Cohn’s indictment is one of many legal battles surrounding GPB. GPB is a private equity firm which manages $1.5 billion in assets primarily invested in the waste management and auto dealership sectors. The firm was allegedly operating an elaborate Ponzi scheme and is currently the subject of investigations by FINRA, the SEC, and state regulators. Several brokerage firms are facing lawsuits and arbitration claims for selling the GPB private placements to investors including: Newbridge Securities, Arkadios Capital, SagePoint Financial Inc., Money Concepts Capital Corp., and Kalos Capital.
If you are concerned about an investment in a GPB Capital Holdings fund or other private placement investments and want to discuss your options, please call the Costello Law Group at 410-832-800 (or Toll Free 877-418-0003) for a free consultation. Tom Costello of the Costello Law Group has 25 years of experience in securities fraud and securities arbitration and represents investors across the nation.