– Banco Espirito Santo, S.A. (“BES”),
a Lisbon-based bank, and one of its affiliates,
Espirito Santo e Comercial de Lisboa, Inc.,
a money transmitter currently licensed with
the New Jersey Department of Banking and
Insurance, have agreed to pay $1.9 million
in civil penalties to settle an investigation
by the New Jersey Bureau of Securities,
within the Division of Consumer Affairs,
that they allegedly violated the state’s
Uniform Securities Law.
Bureau found that BES, its affiliates and
employees allegedly sold or offered to sell
unregistered stocks, bonds and other securities
to existing bank customers in New Jersey
via telephone solicitations and direct mailings.
The BES representatives and agents making
these solicitations also were not registered
with the N.J. Bureau of Securities as legally
required. Additionally, BES, its affiliates
and employees provided investment advice
without having the proper registrations.
terms of the settlement, BES will offer
rescission of the securities it sold to
investors in New Jersey. There are an estimated
1,393 affected investors in New Jersey.
Uniform Securities Law is designed to protect
investors and we expect adherence to the
law,” Attorney General Paula T. Dow
BES clients alleged that they did not receive
accurate and complete disclosures about
the securities they bought when they were
contacted by BES’ unregistered representatives
and agents. The clients reported that they
were told their investments were guaranteed
or would not lose value.
conducted its own internal review of its
operating practices and cooperated with
the Bureau’s investigation. BES has
since revised its business practices.
seen too many investors harmed by investment
outfits operating outside our registration
laws, offering unregistered securities,”
noted Thomas R. Calcagni, Acting Director
of the State Division of Consumer Affairs.
“No one should hand over their hard-earned
money before verifying that both the security
and the person offering it are registered
by our Bureau of Securities.”
Bureau of Securities can be contacted toll-free
within New Jersey at 1-866-I-INVEST
(1-866-446-8378) or from outside New Jersey
at 973-504-3600. The Bureau's
web site is located at www.njsecurities.gov
securities regulators are the first line
of defense in protecting investors”
said Amy Kopleton, Acting Bureau Chief.
“As this case illustrates, we will
go beyond the state’s borders, to
wherever the case leads us, when New Jersey
investors are affected.”
Chief of Enforcement Rudolph G. Bassman
and Attorney/Investigator Sylvia Kolankiewicz
handled the investigation of this matter.
Deputy Attorney General Anna M. Lascurain,
Securities Fraud Prosecution Section Chief,
and Deputy Attorneys General Victoria A.
Manning and Paul E. Minnefor, represented