New Jersey Attorney General Gurbir Grewal/photo by Carmen Natale/ALMNJ AG's Office Blocks Philadelphia Company From Selling Unregistered Securities
The office's Bureau of Securities issued a cease-and-desist order to the company, Complete Business Solutions Group.
December 27, 2018 at 04:46 PM
2 minute read
The New Jersey Attorney General's Office has ordered a Philadelphia-based financial services company to stop selling unregistered securities to state residents.
The office's Bureau of Securities issued a cease-and-desist order to the company, Complete Business Solutions Group, on Thursday. The company, according to the bureau, does business as PAR Funding.
The bureau has charged CBSG with selling securities without registering with the state and employing unregistered agents engaging in “continuous and ongoing” violations of state securities laws.
In a statement, the bureau said that, between April 2016 and December 2017, CBSG sold about $90 million in unregistered securities nationwide, including about $8.7 million to New Jersey residents.
The money raised by CBSG through the sale of unregistered securities was used to offer short-term loans to businesses, which often had to pay between 12 percent and 44 percent interest rates on the loans, the bureau said.
The bureau also found that CBSG entered into “finder's fee agreements” with at least 16 people to offer and sell the CBSG securities, at least four of whom did so in New Jersey, despite not being registered to offer or sell securities in the state.
The bureau's action comes after the company and the Pennsylvania Department of Banking and Securities, in November, entered into a consent order in which the company agreed to pay a $499,000 administrative penalty for selling unregistered securities.
“The bureau's action today puts cash advance companies on notice that we are watching closely,” said state Attorney General Gurbir Grewal in the statement.
“When it comes to the small business funding industry, we're advising New Jersey consumers and investors to use caution,” said Paul Rodriguez, the acting director of the state Division of Consumer Affairs.
Added securities bureau chief Christopher Gerold: “The bureau will not sit back and allow issuers of private offerings to continuously violate state securities laws.”
The consent order the company entered into with Pennsylvania was signed by Joseph Cole, the company's chief financial officer. He did not return a telephone call and it was not immediately clear whether the company was represented by counsel.
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