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It’s never ideal to be arrested and sued for allegedly running a nearly $2 billion Ponzi scheme while having a court-appointed monitor installed to keep future alleged Ponzi scheming to a minimum, but the folks in charge of car dealership private equity shop GPB Capital Holdings had some reason for optimism. For one, there is, we are told, “significant evidence” in their favor which, if it exists, would presumably throw into question whether they had actually defrauded more than 17,000 investors across the country to keep up on the Ferrari payments and to keep the private-jet flight attendant on the payroll. What’s more, the last time one of their number faced trial, it never happened, on account of the pretty sweet deal he cut with the Justice Department.

Alas, unfortunately for David Gentile, Jeffry Schneider and Jeffrey Lash, a new president means a new Justice Department and a new Securities and Exchange Commission, and they are looking rather less kindly on the whole thing.

Chief United States District Judge Margo K. Brodie in the U.S. District Court for the Southern District of New York in Brooklyn placed the SEC’s case on hold after Acting U.S. Attorney Seth DuCharme sought a stay. Mr. DuCharme sought the stay to preserve the secrecy of a continuing grand jury investigation and to prevent inappropriate discovery of matters in the criminal case….

Mr. DuCharme cited concern that the defendants in the criminal case could use discovery in the civil action, which also named them as defendants, to circumvent the stricter limits on discovery involving criminal cases…. The prosecutor also cited concern that witnesses in the criminal case could be prematurely identified through civil proceedings

GPB Capital Fraud Case Is Put on Hold [WSJ]
Merrick Garland arrives at Justice Department and delivers an implicit rebuke to Trump era [CNN]
Gary Gensler, Biden’s Pick to Head SEC, Approved by Senate Committee [WSJ]


car dealer

Maybe It Wasn’t Such A Great Idea To Fire A Guy Who Knew About The Ponzi Payments You Were (Allegedly) Making

Because in addition to “unemployed,” he can also now call himself “whistleblower.”

By Chris Potter (Flickr: 3D Judges Gavel) [CC BY 2.0], via Wikimedia Commons

Private Equity Execs Decide To Help SEC’s Case Against Them

Everything the regulators says is true, apparently, but only to a not-illegal extent.


Accused Ponzi Schemer To Court: Money, Please

David Gentile is accused of making payments people weren’t entitled to, and now would like a few of his own.

merrick garland

Merrick Garland Gets Busy

The Justice Department has a new squad of crypto-cops, a new taste for white-collar criminal enforcement, a new demand for cyber-ransom notifications. And if you happen to know where all of Tether’s money is, it would appreciate a call on that, as well.


Hotlanta A Hotbed Of Hedge Fund, Private Equity Fraud

Allegedly. What I can tell you from on-the-ground reporting is that it is also very, very hot in a literal sense.


If You’re Gonna Inflate Valuations, Best To Avoid The ‘Impossible’

Unless you are aiming for simultaneous knocks on the door from the FBI, SEC and CFTC. Then it’s fine.

(Getty Images)

SEC Making Sure Gary Gensler Will Feel Right At Home

You can authorize and investigation and you can authorize an investigation and you and you and you, too!