David Gentile, Securities Fraud, New York 2023

New York, NY – A shocking case of private equity investment fraud has come to light with the indictment of GPB Capital Founder and CEO, David Gentile, along with two other individuals, Jeffry Schneider and Jeffrey Lash.

The indictment, unsealed on April 4, 2023, charges the trio with securities fraud, wire fraud, and conspiracy in federal court in Brooklyn.

According to the indictment, Gentile, Schneider, and Lash engaged in a scheme to defraud investors by misrepresenting the source of funds used to make monthly distribution payments and the amount of revenue generated by two of GPB’s investment funds, GPB Holdings, LP and GPB Automotive Portfolio, LP.

The defendants allegedly misled investors about the health and performance of their investments by paying them from an undisclosed and improper source, such as investor capital.

The scheme, which took place between August 2015 and December 2018, involved Gentile and Schneider representing to investors that the GPB funds would make a monthly distribution, when in fact, a significant portion of the distributions were paid directly from investor funds.

Gentile, Schneider, and Lash were arrested on April 4, 2023, and are set to appear in federal court in Boston, Massachusetts, Austin, Texas, and Fort Myers, Florida, respectively.

As the case unfolds, it remains to be seen what the outcome will be for Gentile, Schneider, and Lash. The indictment highlights the importance of honesty and integrity in the management of investment funds and the consequences of engaging in fraudulent activities.

In a statement, Acting United States Attorney Seth D. DuCharme expressed his commitment to ensuring honesty and integrity in the management of investment funds. FBI Assistant Director-in-Charge William F. Sweeney, Jr. stated that investment fraud schemes are problematic for the victims and the overall investing public, and that the agency is committed to exposing these frauds and holding the perpetrators accountable.

The indictment details how GPB Capital was a New York-based investment advisor registered with the SEC, serving as the general partner of several investment funds. The business of GPB Capital was to manage the funds, which raised and invested capital in a portfolio of private equity investments.

By uncovering this scheme, authorities aim to protect investors and maintain trust in the free-market system.

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