NEWARK
-- A Livingston investment firm has been
temporarily closed and its assets frozen
under court order after Attorney General
Paula T. Dow and the New Jersey Bureau of
Securities filed suit against the company
and its principals, alleging that they had
defrauded investors out of more than $450,000.
Defendants
Jacob Eisenstark and Blanche Eisenstark,
who are husband and wife, are alleged to
have used the invested funds for their personal
expenses, including the purchase of residences
in Livingston and West Orange, New Jersey
and Palm Harbor, Florida.
The
state’s five-count Complaint, filed
in Superior Court in Essex County, alleges
that the defendants violated the New Jersey
Uniform Securities Law and committed securities
fraud. Rather than invest the funds as instructed,
the defendants allegedly diverted the funds
for personal use.
“The
victims trusted that their hard-earned investment
funds would be applied as promised. Unfortunately,
the defendants allegedly violated their
trust and, in so doing, the State’s
Uniform Securities Law,” Attorney
General Dow said.
The
state is seeking restitution for the defrauded
investors, as well as civil penalties against
the defendants. The court granted the State’s
request to freeze assets. The court-appointed
receiver has been designated to recover
assets from the defendants.
Jacob
Eisenstark was a registered investment adviser
representative and principal of Eisenstark
Advisory, Inc., a registered firm. Blanche
Eisenstark was the secretary for J.N.J,
Capital Management, Inc., a company controlled
by her husband.
Jacob
Eisenstark allegedly told the investors
that they would receive an annual 15% return
on their investments. No investment contracts
were signed, as required by state law, and
the funds were not invested as directed
by the investors.
Marc
B. Minor, Chief of the Bureau of Securities
cautioned that “investors should always
perform due diligence, which includes, among
other things, checking that the person offering
an investment and also the investment itself
are registered with the Bureau.”
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.
Deputy
Attorneys General Anna Lascurain, Chief
of the Securities Fraud Prosecution Section,
and Elizabeth R. Lash are representing the
state in this matter. The investigation
was conducted by Supervising Investigator
Arlene Ferris-Waks and Investigator Rosemary
Gonzalez in the Bureau of Securities.
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