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TRENTON
- Attorney General Anne Milgram and Criminal
Justice Director Gregory A. Paw announced
that the co-owners of an investment firm
that offered specialized financial services
for podiatrists have been indicted on first-degree
charges of conspiracy and money laundering
for allegedly stealing more than $500,000
from clients. They were arrested this morning.
According
to Director Paw, Jeffrey Scott Lafferty,
39 (DOB: 9/29/67), and Vincella L. Ross,
38, who live together in Green Lane, Pa.,
were charged yesterday in a five-count state
grand jury indictment with first-degree
counts of conspiracy and money laundering,
and second-degree counts of securities fraud,
theft by deception and misapplication of
entrusted property. The charges resulted
from a joint investigation by the New Jersey
Bureau of Securities, New Jersey Division
of Criminal Justice, FBI, U.S. Department
of Labor and U.S. Postal Inspection Service.
Lafferty
and Ross were arrested about 8 a.m. today
at their home by members of the investigating
agencies, assisted by troopers from the
Dublin Barracks of the Pennsylvania State
Police. The indictment was handed up yesterday
in Trenton, N.J., to Superior Court Judge
Neil H. Shuster, who set bail at $500,000
for Lafferty and $250,000 for Ross.
“We
allege that these defendants preyed ruthlessly
on investors, stealing the savings that
clients planned to use for retirement and
for their children’s college education,”
said Attorney General Milgram. “They
solicited investors across the U.S. by targeting
podiatrists as their client niche. This
indictment is a superb example of the results
that can be achieved when state and federal
law enforcement agencies join together to
investigate crimes that cross jurisdictional
lines. I want to thank our federal partners
– the FBI, U.S. Department of Labor
and U.S. Postal Inspection Service –
for their outstanding teamwork in this case.”
Lafferty
and Ross were managing partners and owners
of Lafferty & Partners LLC, which specialized
in private wealth management for podiatrists.
The firm had a mailing address in Red Bank,
N.J. The indictment alleges that between
Sept. 1, 2002 and July 26, 2007, Lafferty
and Ross stole a total of more than $500,000
from clients, including a Bergen County
podiatrist, his wife, his office manager
and other investors across the U.S. Rather
than investing the funds for the clients
as promised, Lafferty and Ross allegedly
spent the money to purchase the home where
they live in Pennsylvania and cover their
own personal expenses, including mortgage
payments, airline tickets, hotel rooms,
store purchases and ATM withdrawals.
The
clients received monthly statements from
Lafferty & Partners that falsely represented
that their money was invested. Lafferty
issued fraudulent “dividend checks”
to some of the out-of-state investors to
reinforce the appearance that their money
had been properly invested.
Each
of the first-degree charges carries a maximum
sentence of 20 years in prison. They also
carry criminal fines of up to $500,000 for
the money laundering charge and $200,000
for the conspiracy charge. By statute, prison
time for the money laundering charge would
run consecutive to prison time for the other
charges. The second-degree charges carry
a maximum sentence of 10 years in state
prison and a criminal fine of $150,000.
The
indictment is merely an accusation and the
defendants are presumed innocent until proven
guilty.
The
case is being handled for the Division of
Criminal Justice by State Investigator Cheryl
Smith, Supervising State Investigator John
Jespersen and Deputy Attorney General Francine
S. Ehrenberg. Ehrenberg presented the case
to the state grand jury.
Attorney
General Milgram credited investigators from
the New Jersey Bureau of Securities, under
the direction of Bureau Chief Franklin L.
Widmann; special agents of the FBI’s
Newark Division under the direction of Special
Agent in Charge Weysan Dun; special agents
from the U.S. Department of Labor, Office
of Inspector General, under the direction
of Inspector General Gordon S. Heddell;
agents from the U.S. Department of Labor,
Employee Benefits Security Administration,
under the direction of Jonathan Kay, New
York Regional Director; and inspectors from
the Newark Division of the U.S. Postal Inspection
Service under the direction of Inspector
in Charge David Collins. Attorney General
Milgram also thanked U.S. Attorney Christopher
J. Christie and his staff for their assistance.
Judge
Shuster assigned the case to Superior Court
in Bergen County.
>>
View
Indictment (319k pdf) plug-in
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