WB21 bank boss faces lawsuit by US regulator
The US Securities and Exchange Commission (SEC) has revealed a civil lawsuit against Wintercap S.A., Roger Knox, Michael Gastauer and others, accusing Gastauer of aiding and abetting Wintercap`s fraudulent sale of $165 million worth of shares in microcap stocks. Gastauer denies these allegations.
Gastauer is the CEO of WB21 Group, a Group of fintech companies that made news after the Brexit vote as it moved its European office from London to Berlin, due to the UK’s legal uncertainty. According to the SEC, WB21 N.A. Inc., the US entity of WB21 Group, was not an innovative new entity, but a vehicle for “massive fraud”, supporting its client Wintercap to process the proceeds of the illegal stock sales.
Previously Gastauer received an 18 month suspension by a Swiss Court for commercial fraud and counterfeiting in 2010. Just about the same time a British gambling company Sportingbet sued him in London for alleging taking millions of pounds from it through a fake payments processor platform Apax, according to the Financial Times. Gastauer denies this. Neither incident prevented Gastauer from bouncing back into polite society.
In September 2016, the Wall Street Journal published his claim that he was moving WB21’s European headquarters from London to Berlin. Soon after, Gastauer made a splash in Germany. Despite this man’s alleged wrongdoings, which he denies, in 2016 he hosted Hans Recker, the former Bundesbank board member, as a spokesman at WB21′ s launch event in Berlin. Weber Shandwick, a press relations firm, helped sell Gastauer to German media. The firm’s marketing, led to a rise of its online presence. On top of this, his verified account on Instagram has 1.2 million followers. His bio says “Entrepreneur, Investor, Genius.”
The SEC says that WB21 N.A. Inc., and its tech for international payments, was used to circumvent regulations designed to disguise the clients’ identities. The SEC also says that Gastauer “repeatedly lied to banks” and made a series of false claims in dealing with various organisations. The first defendant named in the SEC’s case is Roger Knox, who allegedly ran an operation to enable corporate insiders at public companies to fraudulently sell their stock. On Wednesday (3 October), the US Attorney’s office for the District of Massachusetts arrested Knox. The full document can be found on the SEC website here (PDF file). In response to the SEC allegations, WB21 said “WB21 and Mr Gastauer deny the allegations and any wrongdoing. The SEC accuses Mr Knox and Wintercap S.A. of securities fraud and other offences including criminal offences. There are no criminal proceedings against WB21 and/or Mr Gastauer.”
