Newton Investment Adviser Arrested for Fraud
BOSTON – A Newton investment adviser was arrested and charged today with pitching fictitious investments to defraud investors out of hundreds of thousands of dollars.
Paul J. Jackson, 58, of Wellesley, was charged with one count of wire fraud.
According to charging documents, Jackson owns and operates Paul J. Jackson & Associates, LLC in Newton, through which he manages retirement funds for clients. Beginning in 2010, Jackson started offering clients and others what appeared to be attractive investment opportunities. The investments Jackson offered typically involved initial public offerings (IPOs) of high-profile companies, but Jackson did not invest the clients’ money as promised. Instead, he took hundreds of thousands of dollars of investor money for his own use. For example, it is alleged that Jackson took $175,000 from one investor to whom he had pitched a lucrative investment in Alibaba’s IPO. Instead of investing the money, Jackson kept $112,000 for himself and gave $60,000 to another investor who had given Jackson more than $450,000 and was demanding his money. When other investors requested their money back, Jackson offered excuses and never told them that he had simply taken their money.
The Massachusetts Securities Division also filed a separate administrative action against Jackson today, charging him with fraud and seeking to bar him from working in the securities industry.
The maximum sentence under the wire-fraud statute is 20 years in prison, three years of supervised release, and a fine of the greater of $250,00 or twice the gross gain or loss. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The U.S. Attorney’s Office received valuable assistance from the Securities & Exchange Commission during the investigation of this matter. The case is being prosecuted by Assistant U.S. Attorney Eric P. Christofferson of Ortiz’s Economic Crimes Unit.
The details contained in the complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.