The SEC says that Jason D. Lazarus, Esq., the CEO of Synergy Settlement Services, and Anthony F. Prieto, Jr., the President of the company, used money that was supposed to go into the accounts of beneficiaries who had died to pay for expensive vacations and golf trips.
Some specific law firms are looking into allegations made by the SEC that two principals of Synergy Settlement Services deceived people who had suffered personal injuries. According to the SEC’s complaint, Lazarus and Prieto set up a nonprofit called Foundation for Those with Special Needs, Inc. and then told people with disabilities that their money would be invested in a pooled trust managed by a non-profit association; however, the SEC claims that Lazarus and Prieto instead used the charity as a front through which to make money off of disabled personal injury victims.
According to the complaint, “the defendants hid from the beneficiaries, the Federal Revenue Agency, and the Social Security Administration that they sent at least $775,000 in trustee and joinder fees to their for-profit business, Synergy, from the accounts of the beneficiaries.
The complaint also says that Synergy and its leaders cheated by using the non-profit group to throw beach parties and golf tournaments for themselves and their clients.
The SEC also filed charges against True Link Financial Advisers, LLC, a licensed brokerage firm, and its CEO, Kai H. Stinchcombe for their work as the pooling trusts’ investment and asset managers.
A detailed view of the Synergy Settlement Services Scam
The SEC has filed fraud charges against Synergy Settlement Services, Inc. of Orlando, FL, its chief executive officer, Jason D. Lazarus, Esq., and its president, Anthony F. Prieto, Jr., of Tampa, FL, alleging that they defrauded people with disabilities into thinking their money would be invested in a trust managed by a nonprofit. The SEC claims the defendants took advantage of disabled personal injury claimants by using a nonprofit trustee as a front.
As per by SEC, Lazarus and Prieto established a nonprofit called the Foundation for People with Special Needs, Inc. with the stated mission of “assisting personal injury victims with special needs.” However, the defendants hid the fact that they had siphoned off at least $775,000 in trustee and joinder fees from the beneficiaries’ accounts and put it into their for-profit business, Synergy, from the beneficiaries, the IRS, and the SSA.
The SEC also says that the defendants used money from the accounts of beneficiaries who had died to pay themselves back, throw parties for themselves, and promote Synergy’s for-profit business. Beneficiaries’ costs were allegedly increased because Synergy, Lazarus, and Prieto invested their money in a different type of mutual fund than they had been made to believe they would.
Eric I. Bustillo, Director of the SEC’s Miami Regional Office, said, “We say that Synergy Settlement Services and its executives took advantage of vulnerable people with special needs to make unethical and illegal profits.”By “treating themselves and clients to golf tournaments and beach parties with the help of a fake non-profit,” Synergy and its executives “are said to have shown greed,” breaking the trust of their victims.
Synergy, the Foundation, Lazarus, Prieto, and the Special Needs Law Firm are accused of violating antifraud sections of federal securities laws in a complaint filed by the SEC. Synergy, Lazarus, and Prieto are all accused of breaking federal securities law registration requirements in the SEC’s lawsuit. All defendants, excluding the Foundation, are subject to permanent injunctions, disgorgement of ill-gotten gains plus prejudgment interest, and civil monetary penalties from the SEC.
True Link Financial Advisers, LLC, of San Francisco, California, and its chief executive officer, Kai H. Stinchcombe, of Healdsburg, California, were also accused by the SEC of their roles as investment and asset managers for the pooled trusts. In a separate cease-and-desist process, True Link and Stinchcombe agreed to settle the lawsuit without admitting or contesting the conclusions that they caused certain violations of the antifraud sections of the federal securities laws.
The civil money penalties that were agreed upon between True Link and Stinchcombe were $200,000 and $20,000, respectively.
Jeffrey Cook and Jordan Cortez are currently leading the SEC probe. Teresa Verges will be in charge of the SEC’s lawsuit on this matter, which Eric Busto and Glenn Gordon are in charge of directing. Robert Levenson and Alice Sum.
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