Skip to main navigationSkip to News Headlines
NJ Division of Consumer Affairs
Global Navigation
Division of Consumer Affairs
The State of New Jersey Office of The Attorney General (Dept. of Law & Public Safety) The State of New Jersey NJ Home Services A to Z Departments/Agencies OAG Frequently Asked Questions
OAG Home
OAG Contact
Division of Consumer Affairs Alerts and Recalls
Division of Consumer Affairs Alerts and Recalls
Office of the Attorney General Homepage Division of Consumer Affairs, Director
Division of Consumer Affairs, Director
`
Division of Alcoholic Beverage Control
Division of Consumer Affairs
Division of Consumer Affairs Highlights
Division of Consumer Affairs Topics in a A-Z List Format
Office of Consumer Protection (OCP)
New Jersey Bureau of Securities
Office of Weights and Measures
Legalized Games of Chance Control Commission
Alternative Dispute Resolution
Professions and Occupations List
Contact the Division of Consumer Affairs
Division of Consumer Affairs in Spanish
Division of Criminal Justice
Division on Civil Rights
Division of Gaming Enforcement
Division of Highway Traffic Safety
Division of Law
Juvenile Justice Commission
NJ Racing Commission
State Athletic Control Board
Division of NJ State Police
Victims of Crime Compensation Office
OPRA - Open Public Records Act
Download Free PDF Reader

spacer spacer spacer
For Immediate Release: For Further Information:
August 12, 2014

Office of The Attorney General
John J. Hoffman, Acting Attorney General

Division of Consumer Affairs
Steve C. Lee, Acting Director

Division of Law
Jeffrey S. Jacobson, Director
Media Inquiries
Jeff Lamm or
Neal Buccino
973-504-6327
spacer
spacer spacer spacer
spacer
New Jersey Bureau of Securities Obtains $5.5 Million Settlement From Bergen County Father and Son Who Defrauded Investors Through Sale of Unregistered Notes and Used Investor Funds For Personal Enrichment
spacer
spacer spacer spacer
spacer
Consent Order
spacer
spacer spacer spacer
spacer

Newark - The New Jersey Bureau of Securities, represented by the Division of Law, has obtained an approximately $5.5 million settlement, including more than $4 million in full investor restitution, from George J. Bussanich Sr., 55, of Park Ridge, and his son George Bussanich Jr., 34, of Upper Saddle River and their two businesses. 

The settlement resolves the State's claims that the defendants defrauded approximately 31 New Jersey investors by selling unregistered notes and using investor moneys as their own "personal slush fund."

"These defendants allegedly lied to investors in order to use investor funds as their personal ATM.  As a result of the Bureau's enforcement action, they are rightly required to provide full restitution to the defrauded investors and are barred from ever again selling securities in New Jersey," Acting Attorney General John J. Hoffman said.

The State's lawsuit, filed in State Superior Court in Newark, alleges that between May 2009 and July 2013, the defendants made false and misleading statements to investors in connection with the sale of unregistered investment notes in Metropolitan Ambulatory Surgical Center, LLC (MASC).   Despite its name, MASC is not an actual surgical center but instead a holding company controlled by Bussanich Sr.

"Without the Bureau's action, the affected investors would have lost enormous sums of money that the defendants spent on luxury cars, homes, and personal expenses," Division of Consumer Affairs Acting Director Steve Lee said.  "The work of the Bureau of Securities has led to millions of dollars in restitution for these investors."  

Under the terms of the settlement, the defendants will pay approximately $5.5 million, including $4,074,097.06 in full restitution to the affected investors, $1 million in civil penalties ($250,000 of which will be suspended if the defendants comply with the terms of the settlement), and certain other costs.  The defendants are also permanently prohibited from acting as agents, broker-dealers, or investment advisors in New Jersey's securities industry; from selling or offering securities in New Jersey; and from controlling or acting as officers or directors of any entity that sells securities.

Bureau of Securities Chief Laura H. Posner said, "The facts clearly indicate that these defendants enriched themselves by lying to investors, through misleading statements as well as omissions of fact, and by spending millions of dollars of investor money on lavish homes, expensive cars, entertainment, and other expenses.  Due to the Bureau's investigation and resulting settlement, the Bussaniches' deceived investors will receive full restitution for their investments."

In the Consent Order resolving the State's lawsuit, Bureau Chief Posner found, among other things, that the Bussaniches sold unregistered and non-exempt securities, and used investor funds for their own and their relatives' personal enrichment.  Specifically, Bureau Chief Posner found that the Bussaniches used investor moneys to purchase multiple homes and seven luxury vehicles – includes two Maserati Quattroportes, a Ferrari F430 Spyder, and a Mercedes ML350 – and to pay for their shopping, dining, airline travel, and entertainment expenses.

The Bureau Chief also found that the Bussaniches made false and misleading statements to their investors.  For example, they failed to inform investors that they were not registered with the Bureau of Securities to sell the MASC notes.  They also failed to explain to investors that they had transferred investor accounts from a Texas custodian to a New Jersey custodian because of the Texas custodian's concern that the MASC notes might be unregistered securities.

These misleading statements and omissions of material fact constitute violations of the antifraud provisions of the Uniform Securities Law.

Deputy Attorneys General Victoria Manning, Joshua Sherman, Stacy-Ann T. Davy, and Isabella Stempler of the Securities Fraud Prosecution Section in the Division of Law represented the Bureau in this matter.

Rudolph G. Bassman, Chief of Enforcement, and Supervising Investigator Peter Cole conducted this investigation on behalf of the Bureau.

The Bureau can be contacted toll-free within New Jersey at 1-866-I-INVEST (1-866-446-8378) or from outside New Jersey at 973-504-3600.  The public is encouraged to visit the Bureau's website at www.njsecurities.gov.

###

   
Contact Us | Privacy Notice | Legal Statement | Accessibility Statement
NJ Home Logo
Divisional: DCA Home | Complaint Forms | Proposals | Adoptions | Contact DCA
Departmental: OAG Home | Contact OAG | About OAG | OAG News | OAG FAQs
Statewide: NJ Home | Services A to Z | Departments/Agencies | FAQs
Copyright State of New Jersey
This page is maintained by DCA. Comments/Questions: email

Page last modified: