NJ Men Charged With Targeting Seniors in Fraudulent Sales of Securities on Craigslist

Two New Jersey men have been charged by the Securities and Exchange Commission with targeting senior citizens and illegally selling $1.1 million in unregistered securities and other investments on the popular Internet website Craigslist.

Paul G. Bultmeyer and Arthur J. Piacentini, the owners of Sherbourne Capital Management Ltd. and Sherbourne Financial, Ltd., allegedly sold “Prime Certificates of Participation,” which they advertised on Craigslist, other Internet sites, and in newspapers.

Instead of investing the money they raised in corporate bonds, preferred stock, government securities, and other instruments, the pair funneled the investor funds to their own bank accounts and to a charter aviation company and payroll services company they operated, serving New Jersey governmental bodies and small businesses, the SEC said.

The pair is accused of ripping off investors, particularly senior citizens, between December 2004 and March 2009. The payroll services company owned by Bulmeyer and Piacentini is called Ameripay LLC and the charter aviation company is Equitaire, Ltd, the SEC said.

“By commingling the fraudulently raised investor funds with the accounts of the payroll services company and its clients, the defendants jeopardized both investor funds and the funds belonging to the payroll company’s clients,” said James Clarkson, Acting Director of the SEC’s New York Regional Office. “The SEC is seeking remedies that will protect the interests of not just the defrauded investors but also the customers of the defendants’ payroll business and their employees whom the fraud has put at grave risk.”

Bultmeyer and Piacentini reportedly targeted retirees in the scheme by advertising themselves as “Your Retirement Income Specialist,” the SEC said. They promised higher interest rate returns than could be earned with savings accounts, certificates of deposit, money market accounts, and mutual funds.

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