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For Immediate Release:  
For Further Information:
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September 27, 2007  

Peter Aseltine
609-292-4791

Office of The Attorney General
- Anne Milgram, Attorney General
Division of Criminal Justice
- Gregory A. Paw, Director

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Couple Indicted for Allegedly Stealing More than $500,000 from Clients of Their Investment Firm

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>> View Indictment (319k pdf) plug-in
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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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