Eccleston Law Investigates New Jersey Investment Adviser Sandra Venetis Following SEC Fraud Charges

The attorneys at Eccleston Law have launched an investigation of Sandra Venetis, a Branchburg, N.J.-based investment adviser and three of her firms, Systematic Financial Services, Inc., Systematic Financial Associates, Inc., and Systematic Financial Services, LLC, for allegedly operating a multi-million dollar offering fraud involving the sale of phony promissory notes to investors, many of whom are retired or unsophisticated in investments. Venetis recently pleaded guilty to defrauding investors out of more than $13.6 million in a Ponzi scheme and using $7 million to settle gambling debts.

The SEC recently alleged that since 1997, Venetis and the three entities that she founded, owned, or controlled obtained more than $11 million from at least 127 investors. Venetis, acting on behalf of the three entities, solicited and obtained funds from clients and others to invest in promissory notes, fixed income investments, or other side investments.  Venetis allegedly told some investors that the promissory notes were guaranteed by the Federal Deposit Insurance Corporation and would earn interest of up to 11 percent per year that would be tax-free due to a loophole in the tax code.  She is believed to have told investors that she would use their money to fund loans to doctors that would be backed by Medicare reimbursement payments to those doctors. Instead of making investments, Venetis allegedly looted investor funds to pay business debts and personal expenses accrued from international travel, gambling, and home mortgages and property taxes. She also allegedly funneled cash to her relatives.

The SEC's complaint also named three relief defendants for the purposes of recovering investor assets now in their possession: Jennifer Venetis (Venetis's daughter); Kevin Persley (Venetis's brother); and Venetis LLC (an entity owned and controlled by Venetis).