The Securities and Exchange Commission filed emergency action and obtained a temporary restraining order and asset freeze on Tuesday to arrest a husband-and-wife team that the regulator said defrauded around 1,200 investors in nearly $ 500 million in an alleged fraudulent scheme, the SEC said Friday.
In a July 24 complaint filed with the United States District Court for the Southern District of Florida and unsealed Friday, the SEC claimed spouses Lisa McElhone and Joseph W. LaForte orchestrated a fundraising scheme. for investors through unregistered securities offerings for Complete Business Solutions Group, the cash advance company they control and which operates as Par Funding.
The couple and their company were named as defendants in the lawsuit, along with several alleged accomplices.
From 1995 to 2000, LaForte worked for various stockbrokers and obtained Series 7 and Series 63 securities licenses in 1996 and a Series 24 securities license in 1997, according to the SEC. However, those licenses have expired, he noted in the complaint.
Among the other defendants named in the lawsuit were two other former brokers: Perry S. Abbonizio, who worked for companies such as Morgan Stanley, Wells Fargo and Oppenheimer & Co., according to the Financial Industry Regulatory Authority’s BrokerCheck site; and Dean J. Vagnozzi, who was suspended by the SEC, according to BrokerCheck.
Lawyers for the law firms that court documents say represent LaForte, McElhone, Abbonizio and Vagnozzi did not immediately respond to requests for comment on Monday. Wells Fargo and Oppenheimer also did not immediately comment. Morgan Stanley declined to comment.
“The McElhone-LaForte duo is in the business of granting opportunistic loans – some of which charge more than 400% interest – to small businesses across America,” the complaint alleges.