Later this week, David Gentile, the founder of a New York-based money manager GPB Capital Holdings LLC, alongside two of his associates were criminally charged over allegations that the limited liability holding company primarily offering investment services, had been running a $1.8 billion Ponzi-like scheme with tens of thousands of retail investors being falsely promised to a steady return over their investments.
To be precise, court documents had revealed that the Chief of the New York-based so-called money manager, David Gentile, had been criminally accused of cheating over 17,000 retail investors, while GPB Capital Holdings LLC., the investment firm which Gentile had founded back in the 2013, was promising an 8 per cent in annual returns even though the company was bleeding fresh capitals.
NY money manager charged with $1.8 billion in fraud scheme
Apart from that, authorities from US SEC (Securities and Exchange Commission) had said that the Manhattan-based money manager had been telling its investors that their investments would be returned with an 8 per cent in annual interests, while the funds would be generated from revenues of the firm’s holdings including a group of car dealership.
Nonetheless, separating facts from fictions, authorities claimed that the investment funds were paying off a significant portion of its term payments from the money that came from newer investors. Apart from that, court documents had also revealed that the defendants including Gentile’s GPB Capital had embezzled millions of dollars including a luxury Ferrari for Gentile alongside a $29,837 in AmEx bill that had covered Gentile’s 50th birthday.
Aside from that GPB Capital Chief Gentile, two of the investment fund’s managing partners such as Jeffery Lash, 51 of Florida alongside Schneider, 52, of Texas, were charged with securities fraud and conspiracy, while Gentile and Lash had also been charged with wire fraud.
Nevertheless, denying the allegations, the Manhattan-based investment services provider said in a statement, “GPB has been cooperating with government investigations and is extremely disappointed by these developments.
According to court documents, GPB managed to secure only $239 million as of December 2020, while it had raised more than $1.8 billion, leading to speculations that the fund manager might be involved in a Ponzi-like scheme.