Father Son Duo in Bergen County Agree to Pay $5.5 Million Dollar Settlement

The New Jersey Bureau of Securities has obtained an approximately $5.5 million settlement from George J. Bussanich Sr. and his son George Bussanich Jr.

The settlement comes as a result of the State’s claim that the defendants Bussanich Sr. of Park Ridge and Bussanich Jr. of Upper Saddle River defrauded about 31 New Jersey investors by selling unregistered notes and using the investor’s money for personal needs.

“These defendants allegedly lied to investors in order to use investor funds as their personal ATM,” Acting Attorney General John J. Hoffman said in a press release. “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.”

The lawsuit alleged that between May 2009 and July 2013, the defendants made false and misleading statements to investors relating to the sale of unregistered notes in Metropolitan Ambulatory Surgical Center, LLC. Rather than being a surgical center, MASC was actually a holding company controlled by Bussanich Sr.

The false statements included failing to inform investors that they were not registered with the Bureau of Securities to sell the MASC notes. They also failed to tell investors that they transferred investor accounts from a Texas custodian to a New Jersey custodian because of the Texas custodian’s suspicion about the MASC notes.

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

The settlement includes more than $4 million dollars in full investor restitution and $1 million in civil penalties. The rest of the settlement will be applied to other costs. Aside from the penalties, the defendants are prohibited from engaging in any activity involving the sale of securities in New Jersey.

Bureau of Securities Chief Laura H. Posner found that the Bussaniches sold unregistered and non-exempt securities and used investor funds not only for their own personal expenses but also for their relatives’ expenses. Investor funds were used by the duo to purchase multiple homes, luxury cars and for personal expenses like shopping, dining and airline travel.

“Due to the Bureau’s investigation and resulting settlement, the Bussaniches’ deceived investors will receive full restitution for their investments,” said Posner.