Case 3:25-cv-01501-PAD-GLS Document 14 Filed 09/29/25 Page 1 of 10
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
WIGBERTO LUGO-MENDER, as the duty
appointed Trustee in the liquidation of
EURO PACIFIC INTERNATIONAL BANK,
INC.,
Plaintiff,
v.
QENTA, INC.; PETER D. SCHIFF; BRENT
DE JONG; ET AL.,
Defendants.
EURO PACIFIC FUNDS SCC LTD.; EURO
PACIFIC SECURITIES, INC.; EURO
PACIFIC CARD SERVICES LTD.; AND
GLOBAL CORPORATE STAFFING LTD.
Parties in Interest.
CIVIL NO.: 25-1501 (PAD)
PETER D. SCHIFF’S RESPONSE TO “EMERGENCY MOTION REQUESTING
HEARING FOR PROVISIONAL REMEDIES, INCLUDING TEMPORARY
RESTRAINING ORDER, TO SECURE SATISFACTION OF JUDGMENT
I. INTRODUCTION
Rarely does a litigant confront a motion that is both patently frivolous and, at least in its
requested relief, entirely justified. Yet this is precisely such a case. Plaintiff Wigberto Lugo-
Mender (“Lugo-Mender” or “Trustee”) has filed what can only be described as an audacious
“Emergency Motion Requesting Hearing for Provisional Remedies, Including Temporary
Restraining Order, to Secure Satisfaction of Judgment,” seeking to restrain the movement of
certain assets allegedly in the possession of Defendant Qenta, Inc. (“Qenta”). (See Docket No. 2.)
The supposed “urgency” of the motion conveniently overlooks the Trustee’s own three-month
inaction after receiving Qenta’s “Notice of Termination of Purchase and Assumption Agreement,”Case 3:25-cv-01501-PAD-GLS Document 14 Filed 09/29/25 Page 2 of 10
through which Qenta purported to misappropriate tens of millions of dollars belonging to Euro
Pacific International Bank, Inc.’s (“EPB”) customers.
The Trustee’s claim of “likelihood of success on the merits” disintegrates under even
minimal scrutiny. He filed this suit alleging a conspiracy to commit fraud knowing full well that
Mr. Schiff never conspired with Qenta or engaged in any improper scheme, yet he advanced it
anyway. That fact alone undermines the integrity of the entire action. The Complaint is completely
without any legal merit: it fails to allege an “enterprise,” a “pattern” of racketeering, or a viable
conspiracy pursuant to the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18
U.S.C. § 1961 et seq.; it attempts to plead fraud without meeting the heightened standards of Rule
9(b); and it hinges on conspiracy allegations that are not only false, but knowingly so. The Trustee
has stitched together a sensational narrative with no legal or factual foundation. So, the question
must be asked, does he truly seek justice for EPB’s customers, or is this lawsuit just a reckless
stunt?
By contrast, Defendant Peter D. Schiff (“Schiff”), whom the Trustee now accuses of
“conspiring” with Qenta, has for months been doing the very thing the Trustee claims to want:
safeguarding customer assets from Qenta’s dissipation. Schiff first sought a temporary restraining
order in Puerto Rico to freeze Qenta’s precious-metal and cash holdings. That motion was denied
solely on jurisdictional grounds, not for lack of evidence. Schiff then re-filed in New York,
obtaining a detailed TRO restraining Qenta from dissipating approximately $50 million in precious
metals, $19 million in cash, and other Euro Pacific assets. The Southern District of New York later
vacated the TRO on removal, not because Schiff’s evidence failed, but because the court held the
Trustee, not Schiff as sole shareholder, was the proper party to pursue the relief.
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The Trustee’s silence about this history is telling. Not only is it highly suggestive of an
insidious motive driving the filing of this action, but it also reflects the flaws in the Trustee’s
approach to EPB’s liquidation. A fiduciary genuinely committed to protecting customer funds
would have stepped directly into Schiff’s litigation, adopted the already-issued TRO, and pressed
forward against Qenta. Instead, the Trustee ignored Schiff’s repeated warnings, squandered
months of opportunity, and now burns customer money on a headline-grabbing but frivolous RICO
case and an overbroad provisional-remedies motion. That is not zealous stewardship; it is a
dereliction of fiduciary duty and a gross misuse of customer funds.
Still, because Mr. Schiff’s sole concern is the welfare of EPB’s customers, he cannot
oppose the provisional relief itself. But the Trustee’s motion, like his Complaint, remains legally
deficient, procedurally reckless, and factually misleading.
II. ARGUMENT
A. The motion does not seek relief against Mr. Schiff.
The Trustee’s motion seeks to attach and enjoin “all EPIB customer monies and assets …
under Defendants’ control.” However, the motion does not mention Mr. Schiff or highlight any of
the Complaint’s (false) allegations regarding his conduct. (See generally Docket No. 2.)
Moreover, the Trustee Declaration’s concedes that after June 30, 2022 OCIF appointed a Trustee
and Mr. Schiff “no longer held authority as a corporate officer.” Docket No. 1-1, ¶7. The Verified
Complaint and Declaration likewise fail to allege that Mr. Schiff is in possession of any customer
property. The Trustee identifies no account, vault, or asset in Mr. Schiff’s custody. The alleged
misappropriation and current possession of customer assets are attributed to Qenta and its
affiliates. Without a nexus between Mr. Schiff and any attachable property, Rule 64 and Puerto
Rico Rule 56 simply do not authorize attachment, garnishment, or a TRO against him.
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B. Mr. Schiff Sued Qenta to Recover Customer Assets.
While the Trustee alleges that Mr. Schiff conspired with Qenta to defraud EPB’s
customers, the facts tell a different story. The Trustee waited sixty-seven (67) days before seeking
any relief against Qenta. In contrast, Mr. Schiff acted within six (6) days of receiving notice of
Qenta’s intention to terminate their agreement with EPB, filing a motion to prevent the dissipation
of approximately $80 million in customer funds. He submitted a detailed emergency motion and
supporting affidavit outlining how Qenta, after assuming custody of these assets under a Purchase
& Assumption Agreement, unilaterally terminated the deal and refused to return the funds. (See
24-cv-1511 (CVR), Docket No. 151.)
Mr. Schiff documented Qenta’s attempt to retain half of the precious metals through a
“discount” scheme and highlighted the Trustee’s failure to take responsibility for the assets. He
requested the Court to freeze all assets transferred to Qenta, order a full accounting, prohibit
misleading communications to customers, segregate the assets, and allow expedited discovery to
trace and secure the property. (See id., Docket No. 151-2.) However, the Court denied the motion,
reasoning that Mr. Schiff was seeking relief against a third party, Qenta, who was not a party to
the action. (See id., Docket No. 152.)1
Undeterred, Mr. Schiff filed a “Verified Petition for Temporary Restraining Order and
Preliminary Injunction in Aid of Arbitration” in the Commercial Division of Westchester County,
New York, just eight days after the Puerto Rico District Court denied his initial request.
(See Exhibit 1, pp. 3–8.) His petition detailed Qenta’s failure to obtain necessary regulatory
approvals prior to closing the agreement, its unilateral termination of the deal, and its unlawful
retention of approximately $50 million in precious metals, $19 million in cash, mutual funds, and
1 Mr. Schiff later submitted an amended motion, which was denied. He also filed a Motion for Reconsideration, which
the Court likewise denied. (See id., Docket Nos. 153, 154, 156, and 157.)
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subsidiaries belonging to EPB’s customers. Judge Linda S. Jamieson granted the TRO, finding
that Mr. Schiff’s petition reflected a likelihood of success on the merits, and issued an order to
show cause to Qenta. (See id., pp. 1–2.)
Qenta promptly removed the case to the U.S. District Court for the Southern District of
New York, where Judge Kevin Castel affirmed the TRO. (See Exhibit 2.) Following a hearing, the
Court vacated the TRO on August 13, 2025, not due to any finding of misconduct or conspiracy
by Mr. Schiff, but because, as a shareholder, he lacked standing to act on behalf of EPB or the
Trustee. (See Exhibit 3.) The Court’s decision effectively invited the Trustee, who indisputably
has standing to move forward, to pursue the same remedies in a more appropriate procedural
posture.
The Trustee goes even further in advancing a false narrative. In his Verified Complaint, he
claims to have “confirmed that the silver inventory remains under the custody of a third-party
custodian in Singapore.” (Docket No. 1, ¶38.) What the Trustee fails to disclose is that it was Mr.
Schiff, acting entirely on his own initiative and without any assistance from the Trustee, who
ensured that Qenta did not gain control of this customer-owned silver. Contrary to the Trustee’s
misleading claim that he recovered the silver, it was Mr. Schiff who successfully intervened to
protect over $10 million worth of silver that the bank had previously transferred to Qenta’s control.
Mr. Schiff demonstrated to the custodian that the silver remained the property of the bank, which
led to the custodian transferring control of the silver back to the Trustee. Mr. Schiff immediately
notified the Trustee of this development and urged him to act swiftly to contact the custodian. (See
Exhibits 4, 5, and 6.) Mr. Schiff then arranged for the silver to be released to the individual
customers who own it. However, that release has been delayed solely due to the Trustee’s refusal
to authorize the distribution of these metals to their rightful owners. It is wholly implausible to
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suggest that Mr. Schiff was conspiring with Qenta while simultaneously taking decisive action to
recover and return customer-owned assets. If Mr. Schiff had truly been conspiring to
misappropriate the $10 million in silver, he would not have gone to great lengths to secure its
return to the bank.
It defies logic to suggest that someone engaged in a conspiracy to misappropriate assets
would simultaneously build a meticulous evidentiary record, file emergency motions across
multiple jurisdictions, and ultimately succeed in obtaining a federal injunction freezing the very
assets he is accused of misappropriating. Mr. Schiff did exactly that. Throughout this process, Mr.
Schiff consistently urged the Trustee to join him in pursuing Qenta. It is unprecedented, indeed,
implausible, for a supposed conspirator to sue his alleged co-conspirator in two separate courts
while actively encouraging regulatory authorities and the Trustee to investigate and/or act against
that same party. This conduct is not consistent with fraud; it is consistent with someone acting in
good faith to protect customer assets. Furthermore, the Trustee’s decision to shy away from
litigation after a standing issue arose, despite Mr. Schiff’s repeated requests to continue, calls into
question whether the Trustee is truly acting in the best interests of EPB’s customers. Rather than
advancing a legal strategy that had already yielded emergency relief, the Trustee inexplicably
reversed course and now brings a sensational and baseless RICO action against the very individual
who took meaningful steps to safeguard those assets.
C. The Trustee’s motion fails to show a probability of success on the merits.
To grant a preliminary injunction, a district court must consider four factors: “(1) a
likelihood of success on the merits, (2) a likelihood of irreparable harm absent interim relief, (3) a
balance of equities in the plaintiff’s favor, and (4) service of the public interest.” Arborjet, Inc. v.
Rainbow Treecare Sci. Advancements, Inc., 794 F.3d 168, 171 (1st Cir. 2015); see also Voice of
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the Arab World, Inc. v. MDTV Med. News Now, Inc., 645 F.3d 26, 32 (1st Cir. 2011) (citing Winter
v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008)). Among
these factors, the likelihood of success on the merits is the most significant. As the First Circuit
has explained, this element “weighs most heavily in the preliminary injunction analysis.”
Russomano v. Novo Nordisk Inc., 960 F.3d 48, 53 (1st Cir. 2020) (citing Ross-Simons of Warwick,
Inc. v. Baccarat, Inc., 102 F.3d 12, 16 (1st Cir. 1996)) (emphasis ours). Accordingly, “[t]he since
qua non of this four-part inquiry is likelihood of success on the merits: if the moving party cannot
demonstrate that he is likely to succeed in his quest, the remaining factors become matters of idle
curiosity.” New Comm Wireless Servs., Inc. v. SprintCom, Inc. (1st Cir. 2002); see also Akebia
Therapeutics, Inc. v. Azar, 976 F.3d 86, 92 (1st Cir. 2020) (“We hasten to add that these four
elements are not of equal prominence in the preliminary injunction calculus. The most important
is whether the movant has demonstrated a likelihood of success on the merits—an element that we
have described as the ‘sine qua non’ of the preliminary injunction inquiry.”).
The Trustee’s Complaint is dead on arrival. Because it is fundamentally defective, he
cannot begin to show any probability of success on the merits sufficient to justify the extraordinary
relief he seeks. Most glaringly, Mr. Schiff’s documented lawsuits against Qenta, the very party he
is now accused of conspiring with, obliterate the Trustee’s false narrative of a fraud conspiracy.
One does not spend months fighting to enjoin and freeze $80 million in assets if one’s aim is to
“swindle” that same money. The Trustee’s silence on Mr. Schiff’s extensive litigation against
Qenta, across hundreds of pages of filings, is as telling as it is misleading.
Moreover, the Trustee claims Mr. Schiff conspired with Qenta to commit fraud on EPB’s
customers, yet nowhere in the Complaint does he identify a single misrepresentation of fact made
by Mr. Schiff—or by anyone else—prior to the critical moment when customers were deciding
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whether to continue with Qenta or opt out. That moment is the only plausible window in which
fraudulent inducement could have occurred, as it was the point at which customers were asked to
make a financial decision. If fraud had occurred, it would have been through misrepresentations
designed to influence the choice to opt-in to banking with Qenta thereby putting more assets in the
hands of the alleged conspirators.
Instead, the only alleged misrepresentations attributed to Mr. Schiff appear in Paragraph
84 of the Trustee’s declaration. (See Docket No. 1-1, ¶84.) Importantly, the Trustee acknowledges
that these statements were made after Qenta had terminated the Purchase and Sale Agreement,
which means they were made while Mr. Schiff was actively suing Qenta to recover the full amount
of EPB’s assets. At the risk of beating a dead horse, it is illogical to suggest that Mr. Schiff was
simultaneously conspiring with Qenta while litigating against them to claw back customer funds.
Moreover, the statements the Trustee identifies as “misrepresentations” are not deceptive
in nature, they are calls to action intended to help customers recover their property. For example:
• “The APA never closed and as such He agreed with the termination.”
• “Silver and metals pertain to the bank, not to Qenta.”
• “The Trustee bears fiduciary responsibility for mutual fund holdings transferred to Qenta.”
• “The Trustee has the silver, with a written authorization from him this can be transferred
to customers. As such instructed customers to request that the silver be transferred to Schiff
Gold.”
• “Opt-In customers should write the trustee via email to get their claims paid as He has all
the information on their accounts.”
These are not fraudulent statements, they are calls to action for customers to assert their
rights and press the Trustee to act to safeguard their property. If Mr. Schiff were engaged in a
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conspiracy to defraud, it makes no sense that he would encourage victims to pursue claims against
his alleged co-conspirators.
In short, the Trustee’s Complaint is utterly without merit. It does not plead the
indispensable elements of a RICO claim—no “enterprise,” no “pattern” of racketeering activity,
no viable conspiracy. Its fraud allegations fall far short of pleading any fraudulent
misrepresentation, much less doing so in conformity with Rule 9(b)’s heightened pleading
standard. Most importantly, its conspiracy theory is not just false but knowingly false. The
Trustee’s claims lack both factual and legal support and, accordingly, do not have a likelihood of
success.
III. CONCLUSION
The Trustee’s motion seeks to enjoin assets currently under Qenta’s control, assets that
undeniably belong to EPB’s customers, but it does not seek relief against Mr. Schiff, nor does it
identify any customer property in his possession. As such, there is no legal basis under Rule 64
or Puerto Rico Rule 56 to impose attachment, garnishment, or injunctive relief against Mr. Schiff.
More importantly, the Trustee’s broader narrative of conspiracy collapses under the weight of the
actual record. Mr. Schiff has spent months actively litigating against Qenta in multiple
jurisdictions, seeking to freeze and recover the very assets the Trustee now claims were
misappropriated through collusion. He obtained a temporary restraining order in state court, which
was affirmed by a federal judge, and only vacated due to a procedural standing issue, not because
of any wrongdoing. These efforts are wholly inconsistent with the Trustee’s allegations and, in
fact, demonstrate Mr. Schiff’s commitment to protecting EPB’s customers.
To be clear, Mr. Schiff supports the principle of enjoining and recovering customer assets
currently held by Qenta, which legally still belong to the bank. There is no basis in law or equity
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for Qenta to terminate an agreement to purchase assets and assume liabilities, then demand a
refund of its $500,000 down payment and walk away with a $50 million windfall at the bank’s
expense. To prevent this unjust enrichment, a TRO must be awarded to freeze all assets that
belong to the bank, given the high probability that Qenta will dissipate those assets before the
bank’s claims can be properly adjudicated. That relief, however, must be pursued through
accurate, legally sound claims, not through sensational and baseless accusations. The Trustee’s
Complaint fails to meet the threshold for a likelihood of success on the merits, lacking the
essential elements of a RICO claim and falling short of Rule 9(b)’s heightened pleading standard.
Mr. Schiff defers to the Court’s discretion on the appropriate remedy but respectfully submits that
the Trustee’s current approach undermines—not advances—the interests of EPB’s customers.
WHEREFORE, Defendant respectfully requests the Court take note of his response and
issue any relief it deems just and proper.
RESPECTFULLY SUBMITTED in San Juan, Puerto Rico on this 29th day of September
2025.
WE HEREBY CERTIFY: Today we have electronically filed the foregoing document
using the CM/ECF system which will send a copy and notification of filing to all counsel of
record.
DMR Law
Capital Center Bldg.
Suite 1101
San Juan, PR 00918
Tel. 787-331-9970
s/Javier F. Micheo Marcial
Javier F. Micheo Marcial
USDC-PR No. 305310