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$2M Penalty Assessed Against West New York Couple for Defrauding Investors

By kcora on
West New York

The New Jersey Bureau of Securities today assessed a $2 million civil monetary penalty against a Hudson County couple and their bogus private investment fund management company for selling sham securities and using more than $500,000 of investors’ funds to buy luxury cars, expensive clothing and jewelry, and other personal items.

West New York residents Alcibiades Cifuentes, his wife, Jennifer Wee Cifuentes, and Cifuentes Fund Management, LLC (“CFM”) violated the State’s Uniform Securities Law by offering investors unregistered securities in the form of investment contracts and/or purported limited partnership interests in the couple’s “investment,” according to the Bureau’s Summary Order.

The Cifuenteses held themselves out as the principals of CFM, which they claimed was a private investment fund management company that invested in foreign currencies. Neither the Cifuenteses nor CFM are registered with the Bureau in any capacity.

Since May 2013, the pair through CFM, raised at least $553,969 from at least 24 unsuspecting domestic and foreign investors, at least 11 of whom were offered and sold the unregistered securities to or from New Jersey.

In addition to ordering the Cifuenteses and CFM to pay a civil monetary penalty, New Jersey Bureau of Securities Chief, Laura H. Posner, ordered the couple to cease and desist from violating the Uniform Securities Law and any related regulations or orders.

In parallel proceedings, today U.S. Postal Inspectors arrested and the U.S. Attorney's Office for the District of New Jersey charged, Alcibiades Cifuentes and Jennifer Wee Cifuentes by complaint with commodities fraud and mail fraud.

CFM’s Offering Documents claimed to provide two options for prospective investors, either an investment in a portfolio of high liquidity currencies which guaranteed a ten percent monthly return or that the investor’s funds would be traded in the foreign currency market.

In reality, Bureau Chief Posner found that the Cifuenteses used the investor funds for their own personal use, including to purchase two Audi luxury cars and to shop at high-end stores like Hermes, Ferragamo, Hugo Boss, Omega, and Sydney Thomas Jewelry. They also misused investor funds to pay for rent, groceries, liquor, and fast food.

The Cifuenteses violations of the law include the use of investors’ funds for personal expenses, including funds that were wired to the personal accounts of the Cifuenteses.

The pair and CFM also repeatedly failed to make timely 10 percent monthly investment returns as promised to investors and to timely pay investors’ redemption requests in full.

The Bureau is charged with protecting investors from investment fraud and regulating the securities industry in New Jersey. It is critical that investors “Check Before You Invest.” Investors can obtain information, including the registration status and disciplinary history, of any financial professional doing business to or from New Jersey, by contracting the Bureau toll-free within New Jersey at 1-866-I-INVEST (1-866-446-8378) or from outside New Jersey at 973-504-3600, or by visiting the Bureau’s website at Investors can also contact the Bureau for assistance or to raise issues or complaints about New Jersey-based financial professionals or investments.