Securities and Exchange Commission v. MintBroker International, Ltd.
1:21-cv-21079
| S.D. Fla. | Jul 21, 2025Background
- The SEC sued MintBroker International Ltd. (d/b/a SureTrader) and its founder, Guy Gentile, for operating as an unregistered securities broker in violation of Section 15(a)(1) of the Exchange Act, and for Gentile’s control and inducement of this conduct under Sections 20(a) and (b).
- SureTrader, based in the Bahamas, targeted U.S. customers to bypass U.S. day trading rules; the company has since been liquidated and was in default for much of the litigation.
- After a ten-day jury trial, the jury found in favor of the SEC on all counts against both defendants.
- The SEC moved for remedies including injunctive relief, disgorgement, prejudgment interest, and civil penalties against Gentile and SureTrader.
- The Report and Recommendation (R&R) analyzed whether the requested remedies were warranted, particularly as they related to Gentile given SureTrader's default status.
- The R&R recommends granting injunctive relief, substantial disgorgement and civil penalties, and outlines the proper amounts and basis for each.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Injunctive relief against Gentile | Gentile’s past violations and ongoing risk justify a permanent injunction. | The injunction is an improper, vague "obey the law" order; not warranted here. | Permanent injunction granted. |
| Disgorgement—joint and several | Gentile is jointly/severally liable for SureTrader’s ill-gotten gains. | SEC’s amount overstates profits; fails to deduct legitimate business expenses. | $13,129,809 in joint/several disgorgement, as calculated by SEC’s method. |
| Disgorgement—Gentile consulting fees | Gentile benefitted from related-party "consulting fee"—should disgorge amount. | No proof full payment was ill-gotten or U.S.-derived; fee not fully tied to violation. | $520,200 (48% of fee) owed by Gentile, reflecting U.S. client share. |
| Civil penalties | Gentile should pay up to the avoided registration costs plus tier-one fine. | Can’t be penalized for SureTrader’s costs; amount is excessive. | $1,887,378 total penalty awarded. |
Key Cases Cited
- SEC v. Almagarby, 92 F.4th 1306 (11th Cir. 2024) (sets out standards for injunctive relief, disgorgement, and benefit-of-victims requirement)
- SEC v. Calvo, 378 F.3d 1211 (11th Cir. 2004) (prima facie case for SEC injunctive relief)
- SEC v. Carriba Air, Inc., 681 F.2d 1318 (11th Cir. 1982) (factors evaluating likelihood of recurring securities violations)
- SEC v. Goble, 682 F.3d 934 (11th Cir. 2012) ("obey the law" injunctions are generally disfavored but sometimes permitted)
- Liu v. SEC, 591 U.S. 71 (2020) (disgorgement must not exceed net profits and must benefit investors)
- Aaron v. SEC, 446 U.S. 680 (1980) (role of scienter in SEC enforcement actions)
- SEC v. First City Fin. Corp., 890 F.2d 1215 (D.C. Cir. 1989) (disgorgement approximation and shifting burden to defendant)