Peter C. Harvey, Attorney General
Division of Consumer Affairs
Reni Erdos, Director
For Immediate Release:
February 18, 2004
For Further Information Contact:
Genene Morris, Jeff Lamm
NEWARK - The New Jersey Division of Consumer Affairs' Bureau of Securities has barred a Gloucester County man from working in the securities industry in New Jersey following his conviction on a federal charge of mail fraud in connection with a scheme he devised that defrauded investors out of more than $500,000, Attorney General Peter C. Harvey, Consumer Affairs Director Reni Erdos and Bureau of Securities Chief Franklin L. Widmann announced today.
As part of the Bureau's order, Gary Tunnicliffe, is prohibited from working as an agent of any securities or investment advisory firm and from selling any security in or from the State of New Jersey and from working as an agent or investment adviser. The Bureau's decision came a week after the Woodbury resident was convicted in federal court of mail fraud, sentenced to 37 months in federal prison and ordered to pay $508,588 in restitution.
Tunnicliffe, who pleaded guilty to the mail fraud charge, admitted to stealing investors' money and diverting the money for his own personal use and benefit.
"Mr. Tunnicliffe's criminal scheme took advantage of trusting investors," Attorney General Harvey said. "Through this action, we are sending a clear message that such activities will not go unpunished in New Jersey."
"This individual used his position as an investment adviser as a license to lie, cheat and steal," Director Erdos said. "He took investors' trust and used it for his own personal gain. He does not deserve to hold a registration in New Jersey."
"We take seriously attempts by anyone to defraud and steal from investors and will do what we must to see to it that their misdeeds are brought to an end," Bureau Chief Widmann said. "We hope Mr. Tunnicliffe serves as an example of what will happen to those who devise fraudulent schemes that hurt investors." Between December 2000 and April 2003, Tunnicliffe was an agent for U.S. Allianz Securities and employed by R.F., L.L.C. (also known as Roster Financial, L.L.C.,) where he provided investment advice to clients. It was during this time period that Tunnicliffe embarked on his own private venture to entice investors into entrusting their investment funds with him.
As part of his scheme, he controlled a company called R.A.I.L. Inc. (also known as R.A.I.L., Inc., L.L.C. Affiliate; R.A.I.L. and Affiliate and R.A.I.L. Financial Group and Investment Co.) through which he offered and sold fictitious high-yield investment contracts to 13 New Jersey residents.
Tunnicliffe, who maintained and controlled bank accounts in his name and in the name of R.A.I.L. at various banks, offered clients financial planning services and induced those clients into liquidating their existing financial holdings in favor of purportedly better investment opportunities with him. Once the proceeds from the sale of the financial holdings were available, investors were instructed to mail the money to Tunnicliffe so he could reinvest into the purportedly high-yield opportunities.
Instead of investing the money as promised, however, Tunnicliffe deposited investors' money in his personal bank accounts and used the money for his personal benefit.