Tr?id=566623520170033&ev=PageView&noscript=1

Arizona Revokes Advisor's License for Misrepresenting High-Risk GPB Capital Investments

Posted on November 26th, 2024 at 10:21 AM
Arizona Revokes Advisor's License for Misrepresenting High-Risk GPB Capital Investments

From the desk of Jim Eccleston at Eccleston Law

The Arizona Corporation Commission has revoked the license of Scottsdale-based investment advisor representative Luke M. Johnson, who sold over $10 million in high-risk private placements by GPB Capital Holdings. According to the commission, Johnson fraudulently sold these securities through his business, Legend Capital, between September 2014 and July 2018, misleading at least 95 investors, primarily Arizona residents, about the nature of the investments.

According to InvestmentNews, the commission found that Johnson provided false assurances to clients, claiming the investments were "solid, safe, and/or low risk" while the GPB Capital materials labeled them as "highly speculative" with a significant risk of total loss. He also misrepresented his own investment in GPB products and failed to inform clients about GPB’s ongoing legal troubles, including accusations of running a Ponzi scheme. In addition, Johnson allegedly falsified some clients’ net worth to meet the accredited investor requirement, which is essential for purchasing high-risk alternative investments.

GPB Capital, founded in 2013, gained popularity for its high-yield private placements and raised $1.8 billion. However, its operations came under scrutiny due to regulatory lapses, eventually leading to an FBI raid in 2019. In a federal court case this summer, GPB executives David Gentile and Jeff Schneider were convicted of securities fraud.

In Arizona’s recent order, Johnson was directed to pay $229,241 in restitution and a $20,000 administrative penalty.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

I learned two important things working with Eccleston Law. First, I made a friend and ally with Jim and Steph for life. Secondly, and this is a crucial life lesson - if you need counsel, then seek out the very best. Jim was referred to me by a most trusted source. I've never had to hire an attorney for anything. Now, I know the value of hiring an important partner. Meticulous, thorough and detailed in preparation is the best way to describe Jim. Brilliant too, I might add. Bottom line, I would highly highly recommend Jim and Stephany for your legal needs. One of the best life decisions I've ever made.

Howard S.

LATEST NEWS AND ARTICLES

1792523173 Law
October 20, 2026
FINRA Orders American Portfolios to Pay $1.6 Million Over Unit Investment Trust Supervision Failures

The Financial Industry Regulatory Authority (FINRA) has ordered American Portfolios, the broker-dealer later absorbed into Osaic, to pay more than $1.6 million in restitution and fines over failures to supervise financial advisors who repeatedly recommended that customers sell unit investment trusts (UITs) before maturity.

1792432258 Law
October 19, 2026
FINRA Bars Former LPL Broker Over Alleged $1.7 Million Customer Theft

The Financial Industry Regulatory Authority (FINRA) has barred former LPL Financial broker Rudy Anguiano after finding that he converted more than $1.7 million from two customers, according to AdvisorHub.

1792164960 Law
October 16, 2026
Ameriprise and Broker Ordered to Pay Edward Jones Nearly $4.8 Million in Trade Secrets Dispute

Ameriprise Financial and broker Cory J.