Erez Law recently filed a lawsuit against Jay Jackler, a registered certified public accountant (CPA), who is alleged to recommend his former client invest in the Castleberry Silver Alternative Investment Fund. The allegations in the complaint filed in Palm Beach County are:
At the advice of Jackler, the client formed a pension plan and maintained an investment account with Raymond James in invested in a diversified portfolio of equities and fixed-income investments. Jackler solicited his former customer to investment the pension plan with Castleberry Financial Services Group LLC.
Jackler represented to the client that Scott Strochak, Director of Alternative Investments at Castleberry, was a very close friend. He also represented to the client that the pension plan account held at Raymond James was not performing well and that an investment with Castleberry would provide superior returns over Raymond James.
It is alleged that Jackler represented to the client that Castleberry was a very successful investment firm that successfully purchased distressed assets and turned them around at significant profits. Jackler also represented to the client that an investment with Castleberry would be insured by a high-quality insurance company that would serve to protect the return of any investment.
Erez Law alleges that Jackler recommended that the client transfer all of the pension plan’s assets at Raymond James to Castleberry, citing potential earnings of 10.23% for a 500,000 1-year investment in a principal-protected CD-like investment that is backed by CNA, which Jackler allegedly said was one of the largest insurers in the world. It is also alleged that Jackler provided material to his former client representing that an investment with Castleberry Investment Program is insured, bonded, and without fees, thus reducing investor risk.
According to the complaint, the agreement that the pension plan entered into with Castleberry represented to the client that the pan would earn 11.76% annually investment was “fully insured and bonded through CNA Surety or one of its authorized affiliates.
It is alleged that Jackler received undisclosed compensation from Castleberry for soliciting the pension plan to invest in Castleberry.
On February 19, 2019, the Securities and Exchange Commission (SEC) filed a complaint in federal court against Castleberry and its President and CEO charging that it defrauded investors by falsely representing that it had hundreds of millions of dollars in capital invested in local businesses and a portfolio of hundreds of investment properties. The SEC also charged that Castleberry falsely claimed that insurance companies CNA and Chubb bonded investors’ investments when in fact they had no relationship to Castleberry. The SEC alleged that Castleberry’s President and CEO misused investor funds to pay for personal expenses and transferred funds to businesses they controlled and to family members.
According to the SEC complaint, “The SEC filed an emergency action in federal district court against Castleberry Financial Services Group LLC, president T. Jonathon Turner, formerly known as Jon Barri Brothers, and CEO Norman M. Strell, alleging that in the past year they have defrauded investors out of $3.6 million.” It is alleged that Turner was previously convicted of multiple felony charges of organized fraud, grand theft, uttering a forged Instrument and forgery, and he was incarcerated between 1998 and 2016.
Castleberry claimed to offer high yields while protecting investors’ principal by having it “fully insured and bonded” by CNA Financial Corp. and Chubb Group, when the insurance companies had no relationship with Castleberry and did not authorize it to use their logos in Castleberry’s sales materials, according to the SEC.
It is alleged that Jackler’s representations regarding Castleberry’s business model, superior returns, and insurance program, amongst other things, were false. Additionally, it is alleged that Jackler failed to disclose that Castleberry was operated by a convicted felon, amongst other things. And, Jackler failed to perform adequate due diligence on Castleberry prior to making recommendations to his clients.
Within five months, the client lost his entire investment.
Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.