New Jersey Bureau of Securities Revokes Registrations of Investment Advisory Firm and Its Owner for Defrauding Elderly New Jersey Investors
Attorney General
The Bureau's action comes on World Elder Abuse Awareness Day, a day when individuals and organizations from around the globe participate in activities and events to raise awareness about the physical, emotional, and financial abuse of elders.
"Preventing the financial exploitation of seniors is a top priority for
In a Summary Penalty and Revocation Order issued today, Bureau Chief
In reality, instead of receiving promissory notes from the diners or developer, investors received personal promissory notes from the owners of those businesses, who had
undisclosed business relationships with Belott. In at least one instance, the promissory note was issued by Belott.
The promissory notes had a term of one year or more with stated interest rates ranging from 5 percent to 18 percent annually. Interest and principal payments to the promissory note investors were paid from the bank accounts of various entities, including the diners, developer and
In offering and selling the promissory notes, Belott failed to disclose to investors that: the diners and developer purportedly issuing the promissory notes were clients of his accounting firm, that he had outside business relationships with the owners of the businesses, or that he was a co-owner of some of the diners. Belott also failed to disclose that he received a commission on the sale of certain promissory notes he sold, or that he would use the investors' funds for his personal benefit.
"Elderly clients of
As set forth in the Summary Penalty and Revocation Order, Bureau
Belott and
* offering and selling unregistered securities;
* engaging in fraud or deceit upon
* engaging in dishonest and unethical practices in the investment advisory business; and
* failing to maintain written investment advisory contracts.
Belott violated
* acting as an agent without registration;
* making untrue statements of material fact and/or omitting to state material facts; and
* making false and misleading statements to Bureau investigators during an investigative deposition.
* failing to make and keep required books and records;
* failing to maintain minimum capital or the required bond while having custody of clients' funds.
"Today, as communities around the world focus attention on the growing problem of elder abuse, the Bureau is reminding everyone that seniors are primary targets for investment fraud," said Bureau
According to the
To minimize the risk of financial exploitation,
* Contact the Bureau to find out if the investment professional and security they are selling are registered.
* Review all information regarding the investment with a trusted relative or friend.
* Allow time for careful consideration - scam artists will often try to rush people into making an investment decision.
* Understand the risks, restrictions and costs of the investment. Never buy without fully understanding every aspect of the transaction.
The Bureau's action was handled by
Deputy Attorney General and Section Chief
More information for both elderly investors and their caregivers can be found on the Bureau's website at www.njconsumeraffairs.gov/bos/Pages/investormaterials.aspx or at www.ServeOurSeniors.org.
The Bureau is charged with protecting investors from investment fraud and regulating the securities industry in
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