A Fair Haven investment adviser who is reported to have a villa in France was charged in federal court in Newark today with running a Ponzi scheme, the Star-Ledger is reporting.
The criminal allegations against Maxwell Smith follow earlier allegations in a civil suit that Smith had swindled $9 million from a now 93-year-old client over a decade, and that Smith had admitted to the wrongdoing.
The federal case alleges Smith stole $7 million by selling investments in health care facilities and promising returns of up to 9 percent, the Sledger reports. But instead of investing the money, prosecutors said Smith deposited it into his own bank account, using a small amount to pay interest to clients, the newspaper reports.
Smith, 69, who until April worked as a financial adviser at Cantone
Research Inc. in Tinton Falls, sat quietly before U.S. District
Magistrate Judge Claire Cecchi in Newark. Afterward, his lawyer said he
plans to fight the allegations.
“He is not running away from the charges. He came here voluntarily,” said the lawyer, Robert A. Weir.
The Sledger says Smith was released on $1 million bail and ordered to seek treatment for gambling and alcohol abuse and to register on New
Jerseys’ casino self-control list.