Furthermore, the SEC said, GPB Capital violated whistleblower laws by including language in broker, consultant and employee termination and separation agreements that kept individuals from communicating directly with the commission. The firm also retaliated against a known whistleblower, the SEC charged.
Jane Norberg, chief of the SEC's Office of the Whistleblower, said, “The charges filed today reinforce the commission’s commitment to protecting whistleblowers from retaliation and attempts to stifle the free flow of information to the commission about possible securities law violations.”
The SEC’s complaint, which was filed in federal court in the Eastern District of New York, seeks disgorgement of ill-gotten gains, plus prejudgment interest and penalties from six parties. Gentile, Schneider, GPB Capital, Ascendant Alternative Strategies and Ascendant Capital are charged with violating the antifraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. Lash is charged with aiding and abetting.
The complaint also charges GPB Capital and Gentile with violating the antifraud provisions of the Investment Advisers Act of 1940 and charges GPB Capital with violating the registration and whistleblower provisions of the Exchange Act’s and Advisers Act’s custody and compliance rules.
The SEC was assisted in the case by myriad law enforcement and regulatory agencies, including the U.S. Attorney’s Office for the Eastern District of New York, the FBI, the Financial Industry Regulatory Authority, the Alabama Securities Commission, the Illinois Securities Department, the South Carolina Office of the Attorney General’s Securities Division, the Office of the Georgia Secretary of State’s Securities Division, the Missouri Securities Division, the New Jersey Bureau of Securities, the New York State Office of the Attorney General and the Texas State Securities Board, the agency said.