White House: President Trump commutes sentence of David Gentile, convicted former Manhasset private equity executive

President Donald Trump has commuted the sentence of former Manhasset private equity executive  David Gentile, a little more than a week after the start of his federal prison sentence for running a $1.6 billion fraud scheme that ripped off thousands of investors, the White House confirmed to Newsday on Sunday.

A Brooklyn federal jury convicted Gentile, 59, the founder and former CEO of GPB Capital, in August 2024 of securities and wire fraud, for misleading more than 10,000 investors into believing that the returns from his three investment funds would buy and operate car dealerships that would generate enough profit to pay out 8% annual returns, according to prosecutors.

When Gentile's investment returns fell short of his promise, he and his partners used money from new investors to pay the dividend, prosecutors said. At the time of the conviction, they likened the scam to a Ponzi scheme.

On Sunday, however, a White House official questioned the validity of the conviction and blamed the Biden administration for misleading jurors.

“Unlike similar companies, GPB paid regular annualized distributions to its investors. In 2015, GPB disclosed to investors the possibility of using investor capital to pay some of these distributions rather than funding them from current operations,” the White House official, who did not give their name, said in an email to Newsday. “Even though this was disclosed to investors, the Biden Department of Justice claimed this was a Ponzi scheme."

Bureau of Prisons records show that Gentile surrendered to federal authorities on Nov. 14 and was released from federal lockup on Nov. 26.

Jeffry Schneider, the CEO of Ascendant Capital, which exclusively steered investors to Gentile’s fund, was also convicted at the same trial and sentenced to 7 years in prison. Jeffrey Lash, a co-founder of GPB, pleaded guilty and cooperated with federal authorities in the prosecution of his former partners.

Gentile could not be reached for comment Sunday. Schneider, whose sentence has not yet begun, declined to comment when reached by phone.

Lash’s attorney, Robert Gottlieb, said that his client, who received a sentence of time served and has paid restitution, is concerned about the equity of the punishment.

“His crime didn't include jail, but there were other serious issues that ... we are discussing to see what steps should be taken so that his disposition is fair and reflects his significantly reduced role in the crime,” the defense lawyer said.

Joseph Nocella Jr., the Trump-appointed United States attorney for the Eastern District of New York, did not respond to a request for comment regarding the clemency. At the time of Gentile's sentencing, Nocella said he hoped to make an example out of him.

“The defendants built GPB Capital on a foundation of lies,” Nocella said in a statement after Gentile and Scheider were sentenced in May. "The sentences imposed today are well deserved and should serve as a warning to would-be fraudsters that seeking to get rich by taking advantage of investors gets you only a one-way ticket to jail. My Office is committed to protecting the investing public and the integrity of the financial markets.”

Prosecutors estimate that GPB lost an estimated $98 million of investor money.

The government collected more than 1,000 affidavits from investors whose finances were affected by the scam to submit to the judge for sentencing.

One victim said that she was afflicted with a form of cancer and now will struggle to cover the cost.

“The funds from GPB were intended to help cover my treatment costs. Without these funds, we are struggling to manage the financial burden of my illness. This crime has not only caused us immense financial loss but has also deeply affected our emotional and physical well-being,” a victim only identified as A.W. wrote of the crime.