A Jersey City-based investment firm and its executives--including a Middletown man--are accused of defrauding investors and raising approximately $12 million through the sale of unregistered securities.
Osiris Fund Limited Partnership, Osiris Partners, LLC, and 10 individuals who either worked for the firms or sold the Osiris Fund’s unregistered securities, are named as defendants in the State’s nine-count complaint filed in State Superior Court in Jersey City, according to a press release issued by the New Jersey Office of the Attorney General (OAG).
Osiris Partners Chairman Peter Zuck, 62, of Middletown and his wife, Laurie Mazza, 52, were among the 10 individuals listed in the complaint.
During the course of its investigation, the OAG found Zuck had been previously convicted of securities fraud and misconduct by a corporate officer, theft by failing to make a disposition of funds, and illegally retaining funds.
“This case clearly illustrates why we urge consumers to perform their due diligence before investing their money,” said Eric T. Kanefsky, Acting Director of the State Division of Consumer Affairs. “Unregistered people selling unregistered securities are serious red flags, as is any past criminal history in the securities industry.”
An additional eight defendants, many of them relatives of the defendants, are named as relief defendants who allegedly benefitted from the fraud through their receipt of cash and other items.
The state alleges the defendants created false investor account statements, overstating Osiris Fund’s net asset value to produce higher management fees and conceal losses, and employed unregistered agents to sell limited partnership interests in the fund. Approximately 76 investors who bought into the Osiris Fund between mid-2009 and the end of 2011 were allegedly defrauded, according to the press release.
“The defendants allegedly lied to investors and then created false records to maintain their deception. We allege these defendants enriched themselves by pocketing at least $4 million of investors’ hard-earned money from the fund while they concealed substantial losses,” Attorney General Chiesa said. “We’re asking the Court to freeze the defendants’ assets, with the goal of returning money to the defrauded investors.”
The defendants and their alleged relationship with Osiris Partners is as follows:
- Peter Zuck, 62, of Middletown, Chairman
- Michael J. Spak, 43, of Chesterfield, CEO
- Joseph C. Spak, 69, of Milltown, Controller
- John R. Najarian, 34, of Hillsdale, Chief Operating Officer
- Brian J. Spak, 36, of Hamilton Square, a member of Osiris Partners
- Victoria Brialmont, 62, of Palm Beach Gardens, Fla., Regional Vice President
- Jay John Soojian, 55, of Wayne, offered and sold Osiris Fund securities
- John Schierer, 46, of Hamilton Square, Dir. Of Research/Technical Analysis
- Laurie Mazza, 52, of Middletown, wife of Peter Zuck
- Wayne G. Player, 50, of Tequesta, Fla., offered and sold Osiris Fund securities
The relief defendants who allegedly benefitted from the ill-gotten gains generated by defrauding investors are as follows:
- Peter L. Zuck, 21, of Middletown, son of Peter Zuck, possessing 47% interest in Osiris Partners with 42% of monthly management fees attributed to him
- Bryan J. Zuck, 29, of Jersey City, son of Peter Zuck and member of Osiris Partners
- Jessica Najarian, 29, of Hillsdale, wife of John R. Najarian
- Loretta Spak, 44, of Chesterfield, wife of Michael J. Spak and overseer of checking and saving accounts at Osiris
In its complaint, the state contends that Loretta Spak is the sole member of Milltown-based ANS Enterprises, LLC, of Milltown and that defendant Jessica Najarian is the sole member of IGF Consulting, LLC, of Northvale. Both companies, along with Wayne Player Productions, LLC, of Tequesta, Fla. and Dexter Group, LLC, based in Wayne are named as corporate relief defendants.
Chief of Enforcement Rudolph Bassman, and Investigators Richard E. Stewart and Peter C. Cole of the Bureau of Securities conducted the investigation. Deputy Attorney General Samuel Scott Cornish, chief of the Securities Fraud Prosecution Section, and Emanuel S. Asmar, deputy attorney general, are representing the state in this action.