Manager Of Investment Firm Sentenced To Four Years In Prison For Defrauding Investors In “Pre-IPO” Scheme

United States Attorney for the Southern District of New York, Jay Clayton, announced today that GIOVANNI PENNETTA, the manager of a Manhattan-based investment adviser and private equity firm, was sentenced to four years in prison for committing wire fraud by running a scheme to fraudulently induce multiple investment clients to part with millions of dollars in exchange for economic exposure to shares of non-public companies. PENNETTA pled guilty on March 5, 2026, and was sentenced today by U.S. District Judge Jed S. Rakoff.

"Falsely promising access to sought-after pre-IPO shares is fraud," said U.S. Attorney Jay Clayton. "The pre-IPO market is a securities market just like the public markets, and there is no place for fraud in any securities market. This Office and our law enforcement partners are watching and will continue to protect investors, no matter the market."

According to the allegations contained in the Indictment and statements made in public filings and public court proceedings:

Over a period of roughly six years, PENNETTA, the manager of a Manhattan-based investment adviser and private equity firm, engaged in a scheme to defraud investors who had entrusted him with millions of dollars to access shares of private companies. PENNETTA induced investors to contribute capital to his private equity fund by promising them economic exposure to shares of pre-IPO companies. In reality, PENNETTA did not have access to the shares he promised, and the investment interests he sold did not provide the exposure he had guaranteed. Instead, PENNETTA misappropriated more than $10 million in investor money, moving much of it to his personal bank account.

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In addition to the prison term, PENNETTA, 51, of New York, New York, and Italy, was ordered to pay restitution in the amount of $11,928,266.25 and forfeiture in the amount of $12,546,279.86, representing proceeds from his illegal scheme.

Mr. Clayton praised the outstanding work of the Federal Bureau of Investigation. Mr. Clayton also expressed appreciation for the assistance of the U.S. Securities and Exchange Commission.

This case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Alexandra N. Rothman and Samuel P. Rothschild are in charge of the prosecution.