SEC Charges New York-Based Investment Adviser and Its CEO and Former Chief Compliance Officer with Securities Violations
Litigation Release No. 25418 / June 10, 2022
Securities and Exchange Commission v. A.G. Morgan Financial Advisors, LLC et al., No. 2:22-cv-03421 (E.D.N.Y. filed June 9, 2022)
The Securities and Exchange Commission today announced charges against registered investment adviser A.G. Morgan Financial Advisors, LLC ("AGM") of Massapequa, New York, AGM's owner Vincent J. Camarda, and AGM's former Chief Compliance Officer James McArthur, for unlawfully offering and selling securities in connection with a more than $500 million unregistered fraudulent offering with lending company Complete Business Solutions Group Inc. d/b/a Par Funding. The SEC previously charged Par Funding and others with operating a fraudulent scheme that raised hundreds of millions of dollars from investors nationwide.
According to the SEC's complaint, the defendants raised more than $75 million from more than 200 investors in connection with Par Funding's unregistered securities offering from at least August 2017 through July 2020, and received compensation of more than $7 million for doing so. The SEC alleges that the defendants offered and sold securities to investors without approval from the registered broker-dealer with whom they were associated. The complaint also alleges that in 2017, AGM and Camarda failed to inform advisory clients that AGM had borrowed, and had not fully repaid, approximately $750,000 from Par Funding.
The complaint, filed in federal court in the Eastern District of New York, charges AGM, Camarda, and McArthur with violating the registration provisions of the Securities Act of 1933 and acting as unregistered broker-dealers in violation of the Securities Exchange Act of 1934, and AGM and Camarda with violating the antifraud provisions of the Investment Advisers Act of 1940. The SEC seeks permanent injunctions, disgorgement plus prejudgment interest, and civil monetary penalties.
The SEC’s investigation was conducted by Christine M. Hernandez and Crystal C. Ivory of the Miami Regional Office, with assistance from Raymond J. Slezak, Michael P. O’Donnell, and Mary Beth Lynch from the Division of Examinations, and was supervised by Elisha L. Frank, Fernando Torres, and Glenn S. Gordon. The SEC’s litigation will be led by Amie R. Berlin under the supervision of Teresa Verges. The SEC appreciates the assistance of the Financial Industry Regulatory Authority (FINRA).