Attorney General Gurbir S. Grewal and the New Jersey Bureau of Securities within the Division of Consumer Affairs announced the revocation of the agent registration of a Livingston broker, and imposition of $100,000 in civil monetary penalties against the agent and his company NJLI Advisors L.L.C., who defrauded an elderly couple of at least $280,000.
According to authorities, Michael Alan Siegel befriended the elderly couple, who were in their 80s, ingratiating himself to them while they were dealing with a significant health issue within the family. Siegel spent hours each week with the elderly husband discussing the stock market. Shortly after the family member passed away, Siegel convinced the elderly couple to transfer their brokerage accounts to a broker-dealer with whom Siegel was associated.
In the Summary Penalty and Revocation Order issued by the Bureau on January xx, 2018, the Bureau Chief found that Siegel convinced the couple to write him checks to invest in options contracts, which he never purchased, pocketing the couple’s money and spending it on travel for him and his family members, high-end audio equipment, and restaurants.
“The behavior outlined by the Bureau in this case is outrageous and infuriating,” said Attorney General Grewal. “Taking advantage of an elderly couple during a time when they most need help and empathy is disgusting. The Bureau did the right thing by making sure this agent never has the ability to con people again under the guise of being a securities agent.”
“Registered securities agents are entrusted with hard-earned money of their clients. Violations such as the ones alleged here must be met with the strongest possible penalties,” said Sharon M. Joyce, Acting Director of the Division of Consumer Affairs. “Only through vigorous enforcement of the law governing agents can the integrity of the financial services industry be ensured.”
The Bureau Chief found that, between July 2013 and January 2016, Siegel exploited his relationship with the couple by having them write checks to him personally for the purported options investments and commissions for the purported investments. Additionally, Siegel violated the policies of procedures of two broker-dealers that Siegel was associated with by accepting checks, loans and gifts from the elderly couple who had accounts with the two firms.
When the husband died, Siegel continued to direct the elderly widow to write him checks for purported options investments and commissions. The widow relied on Siegel for financial decisions and entrusted him with access to her email account, bank accounts, and passwords.
The Bureau Chief also found the following:
· The couple paid for a lease and insurance on a 2014 Cadillac SRX SUV for Siegel, which he was required to but did not report to the broker-dealer with which he was associated.
· The widow co-signed on a lease for a Lexus for Siegel’s daughter and made at least one payment toward that lease, which Siegel was required to but did not report to another broker-dealer with which he was associated.
· In addition to depositing funds into his personal accounts, Siegel also deposited funds into the accounts of NJLI Advisors, L.L.C., of which Siegel was listed as the sole owner, officer, and director.
Investors can obtain information, including the registration status and disciplinary history, of any financial professional doing business to or from New Jersey, by contacting the Bureau toll-free within New Jersey at 1-866-I-INVEST (1-866-446-8378) or from outside New Jersey at (973) 504-3600, or by visiting the Bureau's website at www.NJSecurities.gov.
Investors can also contact the Bureau for assistance or to raise issues or complaints about New Jersey-based financial professionals or investments.