Lax & Neville is currently investigating the activities of Sica Wealth Management, a Securities and Exchange Commission (“SEC”) Registered Investment Advisory (“RIA”) based out of New Jersey, founded and run by Jeffrey Sica (“Jeff”). Despite TV appearances on CNBC, Fox Business, Bloomberg, and various other financial outlets, and the credentialization and authority that comes with having a voice on financial news networks, Jeff has 15 disclosable events on his FINRA BrokerCheck report. Many of these customer complaints allege millions of dollars in losses, and Jeff has settled the majority of them.
Lax & Neville is specifically investigating unsuitable sales practices at Sica Wealth Management relating to account churning, and private placement investments in Aequitas Capital — a billion-dollar Ponzi scheme.
On March 11, 2016, the Securities and Exchange Commission (“SEC”) charged Aequitas Management LLC (“Aequitas Management”), its founder Robert J. Jesenik, fundraiser Brain A. Oliver, and former Chief Financial Officer N. Scott Gillis (collectively the “Defendants”) with defrauding investors. The Complaint alleges that Defendants violated antifraud provisions of the Securities Act of 1933 (“Securities Act”), the Securities Exchange Act of 1934 (“Exchange Act”), and the Investment Advisors Act of 1940 (“Advisors Act”) in connection with security offerings by Aequitas and its entities.
Aequitas defrauded investors into thinking they were investing in a portfolio of trade receivables in expanding consumer sectors such as healthcare and education, when in reality the largest percentage of investor funds were used to repay earlier investors and pay Aequitas operating expenses. The amount of funds used to pay Aequitas operating expenses far exceeded the fee structure investors were told they would be charged.
Aequitas Commercial Finance, LLC (“ACF”), its parent, Aequitas Holdings, LLC, and its various affiliates and subsidiaries (collectively “Aequitas”) ostensibly invested in “trade receivables” of companies in education, healthcare, auto sales, and other industries. However, by the time many RIA’s such as Sica Wealth Management placed client savings in Aequitas, Aequitas invested in nothing. It has since been placed in receivership and sued by the SEC for, among other things, securities fraud and investment adviser fraud.
While Aequitas purported in its Private Placement Memorandum and offering documents to invest in “trade receivables,” the vast majority of these were private education loans to students defrauded by Corinthian Colleges, an amalgamation of for-profit “colleges” shut down by state and federal regulators in mid-2014. Despite it being readily apparent in mid-2014 that those loans were largely uncollectible and already under scrutiny by regulators, who would ultimately demand complete forgiveness from lenders and secondary purchasers like Aequitas, some RIAs, such as Sica, invested client funds in these highly risky high yield notes.
The attorneys at Lax & Neville LLP have extensive experience in successfully prosecuting claims on behalf of customers who have suffered losses as a result of investment and securities fraud. If you are a victim of fraud or were a customer of Sica Wealth Management or have invested in Aequitas, please contact Lax & Neville LLP today at (212) 696-1999 to schedule a consultation.