An executive with a New York-based private equity firm has been charged with fraud in connection with an alleged scheme to dupe investors with a promise of access to pre-IPO companies.
According to U.S. authorities, Giovanni Pennetta, a managing partner at investment advisory and private equity firm Sestante Capital LLC, has been arrested and charged with securities fraud, wire fraud and aggravated identity theft.
In an indictment that was unsealed in federal court in Manhattan, authorities allege that, starting in 2019, Pennetta offered investors exposure to shares in private companies, which he claimed to have access to through a private fund, NextGenTech Investments LLC, that was advised by Sestante.
Authorities alleged that many of these misrepresentations centered around Pennetta’s purported access to shares of Anduril Industries, Inc., a private defence technology company. Investors were allegedly offered exposure to the company’s shares by purchasing interests in a particular series of the NextGenTech fund.
“In furtherance of this scheme, Pennetta provided his victims with falsified documents purporting to show his access to Anduril shares and that particular series of NextGenTech offered exposure to Anduril shares,” it’s alleged.
However, U.S. authorities say that these claims were false — that neither Pennetta, nor the fund, had access to the company’s shares — and victims who paid millions of dollars to NextGenTech didn’t receive anything for their money, most of which was allegedly transferred to Pennetta’s personal bank account.
“As alleged, Giovanni Pennetta took advantage of investors by promising access to private, pre-IPO companies he did not control and never had access to,” said U.S. attorney, Jay Clayton, in a release.
The allegations have not been proven, and he is presumed to be innocent.