The Tribune

By NEIL HARTNELL 

Tribune Business Editor 

nhartnell@tribunemedia.net

A BAHAMIAN broker/ dealer’s principal yesterday vowed “this is far from over” after a jury found himself and his former company guilty of violating US securities laws when operating from Nassau.

Guy Gentile, head of MintBroker International, which was placed into full liquidation by the Bahamian Supreme Court in December 2021, signalled to Tribune Business in messaged replies to this newspaper that he plans to appeal the July 2, 2024, verdict which comprehensively found for the Securities & Exchange Commission (SEC) on all charges brought against him.

However, voicing “100 percent confidence” that the verdict “will be reversed”, Mr Gentile argued that he “won this case in every respect” as he accused the south Florida district court judge of giving the jury “incorrect instructions” on what constitutes actively soliciting US clients.

Asserting that “the truth will always set you free” Mr Gentile pointed out that it had previously taken him eight years to defeat the SEC, the US federal capital markets regulator, in a separate legal battle in New Jersey. He voiced confidence of a repeat despite the south Florida jury, after a ten-day trial, finding himself and his Bahamian broker/dealer guilty of soliciting US clients without first registering with the SEC.

Deciding that Mr Gentile failed to show MintBroker, which previously traded as both SureTrader and Swiss America Securities, qualified for an exemption from the US Exchange Act’s provisions, the jury found that on “a preponderance of the evidence” the SEC proved all securities law violations levied against the Bahamian broker/dealer and its principal.

Mr Gentile, not surprisingly, did not see it that way as he criticised Judge Torres’ jury instructions and legal changes that occurred during a trial where the SEC was “getting wrecked”. He asserted to Tribune Business: “This verdict will be reversed. The jury was given incorrect instructions. I won this case in every aspect.

“Unfortunately, the court gave an incorrect definition of solicitation to the jury, which was never the definition of solicitation. The court even acknowledged this when it denied the SEC’s motion for summary judgment a few months ago. I was shocked that, after a four-week trial, with the SEC getting wrecked, the law suddenly changed 30 minutes before jury deliberations.

“This new definition would obliterate any exemption from SEC registration. If this was the definition, SureTrader would never have serviced any US clients, meaning no foreign broker/dealer could ever have a US client without being registered with the SEC,” he added. “This would cause international financial disruption and would never hold up to appellate review.

“I am 100 percent confident the verdict will be vacated and the case dismissed for violation of due process. Unfortunately, litigation takes a long time. In my last case, it took eight years to finally defeat the SEC. The truth will always set you free, so despite the SEC’s sham case, this is far from over.”

The SEC, though, hailed the jury’s verdict which ended its more than three- year pursuit of Mr Gentile and his Bahamian broker/ dealer in the south Florida court. It filed the initial lawsuit against them in March 2021.

“After a ten-day trial, a jury in the southern district of Florida found Guy Gentile, the founder, owner and chief executive of MintBroker International, formerly known as Swiss America Securities and doing business as SureTrader, liable as a control person of Sure-Trader, which operated as a broker-dealer in the US without being registered, in violation of the federal securities laws,” the SEC said. 

“The jury also found Guy Gentile liable for encountered challenges inducing SureTrader’s registration violations.” Sanjay Wadhwa, the SEC’s deputy enforcement director, added: “We are pleased with today’s swift jury verdict holding Gentile accountable for his violations. Registration requirements play a critical role in protecting investors.

“SureTrader’s years-long failure to register as a broker/dealer deprived investors of significant protections, including SEC inspections, financial responsibility rules and recordkeeping requirements. This trial underscores that the Commission will continue to hold responsible those who seek to evade the registration requirements of the federal securities laws.”

Evidence provided by Bahamian whistleblowers, especially Philip Dorsett, MintBroker’s ex-compliance officer, and another former executive, Yaniv Frantz, featured prominently in the trial as well as documents provided by the broker/dealer’s former regulator, the Securities Commission of The Bahamas, and the Bahamian liquidators.

Igal Wizman, the EY Bahamas accountant and partner, who together with his Cayman colleague, Eleanor Fisher, acts as MintBroker’s liquidator, revealed in a June 12, 2024, affidavit that they sent 484,488 files to the SEC in response to the latter’s request for judicial assistance. The information was provided under a Supreme Court Order obtained by the Attorney General’s Office.

Initially appointed as joint provisional liquidators, Mr Wizman alleged that he and Ms Fisher initially found it difficult to obtain MintBroker’s corporate books and records. “On April 20, 2020, Mr Gentile provided a change of name certificate for the company and referred to the company’s registered agent for the remaining requested documents,” he recalled.

“Despite numerous attempts to recover information, the joint provisional liquidators encountered challenges obtaining the company’s books and records. The joint provisional liquidators brought this to the court’s attention, leading to the judge instructing Mr Gentile to deliver the company’s records to the joint provisional liquidators by June 12, 2020.”

Davis & Co, MintBroker’s legal representatives, succeeded at the second attempt in providing many of the files requested. 

“On August 28, 2020, Davis & Co provided the joint provisional liquidators with a Google Drive link to access certain books and records of the company, but the joint provisional liquidators encountered challenges accessing same,” Mr Wizman alleged.

“After extensive correspondence with Davis & Co, on September 2020, it sent an external hard drive to the joint provisional liquidators containing certain books and records of the company, specifically client information including KYC (know your customer) documents and trading information.”

Mr Gentile spent considerable time, during the preliminary legal sparring leading up to the jury trial, seeking to prevent more than 40,000 documents obtained by Mr Dorsett and MrFranz from being used as evidence against him.

His efforts ultimately proved unsuccessful, but he managed to succeed in creating hurdles for evidence supplied by the Securities Commission and MintBroker’s liquidators. The south Florida court, in a June 3, 2024, ruling found that documents provided from these two sources needed to be further “authenticated” before they could be introduced at trial in response to a legal motion from Mr Gentile.

Mr Gentile enjoyed a somewhat colourful stay in the Bahamas, with Tribune Business reporting in 2016 how he and his broker/ dealer, then-based in the Elizabeth on Bay Plaza on Bay Street, were alleg- edly used as “bait” by the Federal Bureau of Investi- gations (FBI) to help snare numerous international securities fraudsters.

Mr Gentile claimed that he and his Bahamian businesses were “forced” to play key roles in undercover ‘sting’ operations targeting criminals earning millions of dollars from market manipulation scams.

Their participation even extended to the ‘bugging’, both by video and sound, of MintBroker’s Bahamian head office in a successful bid to gain evidence against a Canadian fraudster who subsequently pleaded guilty to the charges against him.

He also attracted international media coverage after his Russian-born, model girlfriend, Kristina Kuchma, 24, in a fit of rage drove his Mercedes S400 hybrid into the pool at his Ocean Club home after he ended their 18-month relationship by text and allegedly reneged on a promise to provide $50,000 for one of her business ventures.

Mr Gentile and his company exited the Bahamas at end-2019 when faced with regulatory actions and investigations by the Securities Commission of The Bahamas. However, in so doing, he bought sufficient time to voluntarily wind-up the broker/dealer himself and remove all its assets from The Bahamas.

That came after Philip Davis KC, then the Opposition’s leader, acting on Mr Gentile’s behalf filed a successful Judicial Review challenge that thwarted the Securities Commission’s efforts to take regulatory action against MintBroker for several months.