Attorney General Announces Lawsuit Against Unregistered
Investment Firm Accused of Defrauding $15 Million from Clients
NEWARK - Attorney General Anne Milgram announced today that investigators from the New Jersey Bureau of Securities (NJBOS) seized records and computers from a Fanwood-based investment company charged with defrauding investors and being operated by an unregistered individual.
An estimated 80 investors lost about $15 million they invested with Anthony Lucchetto Jr., owner of Serafino Holdings, L.L.C. Rather than investing monies in Commercial Bridge Loans for construction projects, Lucchetto and Serafino Holdings are accused of putting most of investors' monies into a fund that turned out to be a Ponzi scheme.
The NJBOS, which filed suit against Lucchetto and Serafino Holdings on Wednesday for violating the state's Securities Law, requested and obtained court approval to freeze Lucchetto's and the company's assets and to seize records and computers.
"These defendants won their victims' trust by offering attractive-sounding investment returns that were never going to materialize, then essentially stole their hard-earned money," said Attorney General Milgram. "This is unconscionable conduct, particularly during difficult economic times, and we are committed to holding them accountable for it."
The state is seeking restitution for consumers and will determine what assets the defendants have following review of the seized records. The state also is seeking to permanently bar Lucchetto from working in the securities industry in New Jersey and the assessment of civil penalties.
The state's seven-count complaint, filed in State Superior Court in Union County, alleges that Lucchetto and Serafino Holding violated the state's Securities Law by:
- Employing a device, scheme or artifice to defraud;
- Making materially false or misleading statements and/or omitting material facts;
- Engaging in fraud or deceit in the offer, sale or purchase of securities;
- Acting as an agent without being registered;
- Employing unregistered agents; and
- Selling unregistered securities
"Usually, every person selling securities in the state, and every security itself, must be registered with the New Jersey Bureau of Securities," said Amy Kopleton, NJBOS Acting Chief. "Before investing, investors should contact the Bureau and check whether the individuals and the securities are properly registered."
Lucchetto previously had been registered with the NJBOS as an agent and investment advisor but was not registered at the time of these alleged activities. He allegedly told investors that their invested funds were 99% secured by asset liens and they would receive 6.5% quarterly rates of return on their investments.
NJBOS investigators so far have identified one couple and three individuals who collectively invested nearly $700,000 with the defendants. One of these investors has told investigators that Lucchetto said about 80 people had invested a total of $15 million with him.
In an email to his investors sent this January, Lucchetto wrote that he allegedly transferred the invested funds to Agape World, which turned out to be a Ponzi scheme. A Ponzi scheme is a fraudulent operation that pays returns to investors from their own money or money paid by subsequent investors rather than from generated profits.
Rudolph G. Bassman, Acting Chief of Enforcement for the NJBOS, conducted the investigation of this case. The state is represented by Deputy Attorney General Victoria A. Manning.
The Bureau of Securities can be contacted toll-free within New Jersey at 1-877-I-INVEST (1-877-446-8378) or from outside New Jersey at 973-504-3600. The Bureau's web site is located at www.njsecurities.gov.