Manhasset Investor Charged In Equity Fraud: U.S. Attny

MANHASSET, NY — A Manhasset investment banker who ran GPB Capital was involved in a ponzi-type scheme misrepresenting the source of funds used to make monthly distribution payments to investors and revenue generated by the company, the U.S. Attorney’s office said.

David Gentile, the 54-year-old founder, owner and Chief Executive Officer of GPB Capital, was arrested Thursday on charges of securities fraud, wire fraud and conspiracy. Also charged in the scheme was former GPB general managing partner Jeffrey Lash 51, of Naples, Fla., and the owner and CEO of Ascendant Capital LC, Jeffrey Schneider, 52, of Austin, TX.

They face up to 20 years in federal prison based on the charges, prosecutors said.

The three men “repeatedly misled investors” about the health and performance of their investments by paying investors from an “undisclosed and improper source” such as investor capital, said Acting U. S. Attorney Seth DuCharme.

The scheme took place over a three-year period between 2015 and 2018, prosecutors said.

Gentile and his co-defendants misrepresented the holdings of GPB Capital through “deceptive marketing practices, luring investors with promises of monthly distributions that would be covered by funds from the investments and not drawn from underlying invested capital,” said Federal Bureau of Investigation Assistant Director-in-Charge William Sweeney.

“As we allege today, however, this was all a lie,” he said, adding that a “significant portion” of the firm’s distributions were paid directly from investor funds. “Investment fraud schemes are not only problematic for the victims they claim, but for the overall investing public who loses faith in a free-market system every time they hear of crimes like this,” he said.

Gentile’s attorney, William McGovern of Manhattan, was not immediately available for comment.