According to New Jersey’s Attorney General’s Office and Division of Consumer Affairs, JB Financial Resources and its owner Jeffrey Mitchell Isaacs must pay a $750K for allegedly selling NJ investors over $7M in unregistered securities connected to the $1.2B Woodbridge Ponzi Scam. More than 8,500 people are said to have been defrauded nationally in that scheme before its demise last year.
The state of New Jersey contends that JB Financial Resources and Isaacs sold about 88 unregistered securities on behalf of the Woodbridge Group of Companies. Isaac’s other entity, JMI Associates LLC, is also accused of promoting and selling unregistered investments, including first position commercial mortgage securities (FPCMs) tied to Woodbridge in NJ.
Marketing collateral touted the unregistered securities as a “unique lending opportunity.” Sale proceeds would reportedly be used by the Woodbridge Funds to issue commercial loans to commercial borrowers. Instead, the FPCMs sold to NJ investors were not collateralized right away. In certain instances, borrowers did not get the loans for weeks or months after investors bought them.
The real estate developer paid Isaacs $195K for selling the investments. Now, however, Division of Consumer Affairs Acting Director Kevin Jesperson is claiming that Isaacs and his firm was not legally authorized to sell investments in the state. This is not the first time that Isaacs has come under investigation in New Jersey. In 2013, allegedly unethical and dishonest practices led to the suspension of his investment adviser and agent registrations. Isaacs allegedly began selling Woodbridge Group-offered securities that year up through 2017.
The Woodbridge Group had touted the development of “high end real estate” in California and that the loans would be used to real estate developers. The company sold FPCMs to investors in order to garner funds for the loans. Unfortunately, many of the agents employed by Woodbridge either were unregistered or had already been barred or censured by regulators.
If you sustained losses because of the Woodbridge Ponzi scam, you may have grounds for a securities fraud case. Contact Shepherd Smith Edwards and Kantas, LTD LLP today. There may be more than one firm that should be held liable for your losses. One of our Woodbridge Ponzi fraud lawyers would be happy to offer you a free, no obligation case evaluation.
‘Loyal son of Rutgers’ fined $750K after Ponzi scheme implodes, NJ.com, April 18, 2018
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Broker Fraud Allegations Lead to Finra Bars for Northwestern, Fortune Financial, and Morgan Stanley Representatives, Stockbroker Fraud Blog, March 24, 2018
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