UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF FLORIDA 

 CASE NO.: 

SECURITIES AND EXCHANGE COMMISSION, 

 

 Plaintiff, 

 

v. 

COMPLETE BUSINESS SOLUTIONS GROUP, 

 INC. d/b/a/ PAR FUNDING, 

FULL SPECTRUM PROCESSING, INC., 

ABETTERFINANCIALPLAN.COM LLC 

 d/b/a/ A BETTER FINANCIAL PLAN, 

ABFP MANAGEMENT COMPANY, LLC UNDER SEAL

 f/k/a/ PILLAR LIFE SETTLEMENT 

 MANAGEMENT COMPANY, LLC, 

ABFP INCOME FUND, LLC, 

ABFP INCOME FUND 2, L.P., 

UNITED FIDELIS GROUP CORP., 

FIDELIS FINANCIAL PLANNING LLC, 

RETIREMENT EVOLUTION GROUP, LLC, 

RETIREMENT EVOLUTION INCOME 

 FUND, LLC , f/k/a RE INCOME FUND, LLC, 

RE INCOME FUND II, 

LISA MCELHONE, 

JOSEPH COLE BARLETA a/k/a/ JOE COLE, 

JOSEPH W. LAFORTE a/k/a JOE MACK 

 a/k/a/ JOE MACKI a/k/a JOE MCELHONE, 

PERRY S. ABBONIZIO, 

DEAN J. VAGNOZZI, 

MICHAEL C. FURMAN, 

and JOHN GISSAS 

 Defendants, and 

THE L.M.E. FAMILY TRUST, 

 Relief Defendant. 

___________________________________________/ 

SECURITIES AND EXCHANGE COMMISSION’S EMERGENCY EX PARTE MOTION 

FOR TEMPORARY RESTRAINING ORDER AND OTHER RELIEF

MC Jul 27, 2020 MIAMI

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Table of Contents 

I. INTRODUCTION ..................................................................................................................1

II. DEFENDANTS AND RELIEF DEFENDANT 

A. Defendants ..........................................................................................................................4 

1. The Par Funding Entities and Employees 

 a. Complete Business Solutions Group d/b/a Par Funding ...........................................4 

 b. Full Spectrum Processing, Inc. ................................................................................6 

 c. Lisa McElhone ..........................................................................................................6 

 d. Joseph La Forte a/k/a Joe Mack a/k/a Joe Macki 

 a/k/a Joe McElhone ..................................................................................................7 

 e. Joseph Cole Barleta a/k/a Joseph Cole a/k/a Joe Cole .............................................8 

 f. Perry Abbonizio .........................................................................................................8

2. The “A Better Financial Plan” Companies and Owner 

 a. Dean Vagnozzi .........................................................................................................9 

 b. ABFP Management Company, LLC ......................................................................10 

 c. Abetterfinancialplan.com d/b/a A Better Financial Plan .......................................10 

 d. ABFP Income Fund, LLC ......................................................................................11 

 e. ABFP Income Fund 2, LLC ...................................................................................11 

3. The Florida Investment Firms, Agent Funds, and Owners 

 a. Michael Furman .....................................................................................................12 

 b. United Fidelis Group LLC .....................................................................................12 

 c. Fidelis Financial Planning LLC .............................................................................12 

 d. John Gissas.............................................................................................................13 

 e. Retirement Evolution Group, LLC ........................................................................13 

 f. Retirement Evolution Fund f/k//a RE Income Fund ...............................................13 

 g. RE Income Fund 2 LLC ..........................................................................................13 

B. Relief Defendant LME 2017 Family Trust .....................................................................14 

III. JURISDICTION AND VENUE ..........................................................................................14

IV. THE FRAUDULENT PAR FUNDING SECURITIES OFFERING SCHEME 

A. Par Funding .....................................................................................................................15 

B. Phase 1 of the Offering: Par Funding Issues Promissory Notes 

 Directly to Investors ........................................................................................................16 

C. Par Funding Learns It Is Under Investigation For State Securities Law 

 Violations And Restructures Its Offering To Conceal Adverse Information ...........18 

 

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D. Phase 2 of the Offering: Par Funding Uses Agent Investment Funds To Raise 

 Investor Money And Issues Its Notes To The Agent Investment Funds ....................19 

1. Vagnozzi and Par Funding’s Roles In Creating, Managing, and 

Promoting The Agent Funds’ Securities Offerings ....................................................19 

2. Vagnozzi Offers and Sells Notes Through His Own Agent Funds: 

 ABFP Income Fund and ABFP Income Fund 2 .........................................................21 

3. Furman Offers and Sells Notes Through His Own Agent Fund: 

 Fidelis Planning ...........................................................................................................24 

4.. Gissas Offers and Sells Notes Through His Own Agent Funds: 

 RE Income Fund and RE Income Fund 2 ...................................................................26 

E. Phase 3 of the Offering: Par Funding, Vagnozzi, and Furman 

 Offer “Exchange Notes” ................................................................................................27 

F. The Securities Offerings Are Ongoing and The ABFP Defendants 

Are Planning To Expand .................................................................................................29 

G. Material Misrepresentations and Omissions in Connection With The 

Par Funding, ABFP, United Fidelis, and Retirement Evolution Offerings ................32 

1. False Claims about Par Funding’s Rigorous Underwriting Process ............................32 

2. False and Misleading Claims about Par Funding’s Loan Default Rate .......................35 

3. False Claims that Par Funding Offers Insurance on Its Loans .....................................38 

4. Misrepresentations and Omissions about LaForte’s Background ...............................39 

5. Misrepresentations and Omissions about Par Funding’s 

Regulatory History .......................................................................................................41 

6. Misrepresentations about the New Jersey Order .........................................................42 

7. False Statements In Par Funding’s S.E.C. Filings 

About McElhone and Cole’s Receipt of Funds ...........................................................43 

8. False Claims about LaForte’s Personal Investment in Par Funding ............................44 

9. Misrepresentations and Omissions about Vagnozzi’s Regulatory History .................45 

10. Misrepresentations and Omissions about ABFPs Regulatory History ........................47 

11. Misrepresentations and Omissions about Abbonizio’s Regulatory History ................48 

 

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VI. MEMORANDUM OF LAW 

A. Standard for Obtaining a Temporary Restraining Order ..........................................49 

B. The Commission Has Established Prima Facie Violations 

Of The Securities Laws........................................................................................................... 50

1. The Offered Investments are Securities............................................................................ 50

a. The Par Funding, ABFP Funds, Fidelis Financial Fund, 

 and RE Fund Promissory Notes Are Securities........................................................ 50

 i. Defendants Self-Identified The Notes as Securities.......................................... 50

 ii. The Promissory Notes Securities ......................................................................... 50

 iii. The Notes Also Are Investment Contracts......................................................... 52

b. The Limited Partnership Interests ABFP Offered Are Also Securities.................. 53

2. All Defendants Are Violating Sections 5(a) and (c) of the Securities Act .................. 53

3. Par Funding, Full Spectrum, ABFP, ABFP Management, McElhone, Cole, 

LaForte, Abbonizio, and Vagnozzi, United Fidelis and Furman Are Violating 

Securities Act Sections 17(a)(2) And Exchange Act Section 10(b)  ............................ 55

a. The Defendants Are Making Material Misrepresentations 

 and Omissions........................................................................................................... 57

b. The Misrepresentations and Omissions are Material............................................. 59

c. The Defendants’ Scheme Liability.......................................................................... 61

d. McElhone and LaForte Are Liable As Control Persons 

 of Par Funding and Full Spectrum .......................................................................... 63

e. LaForte, McElhone, Cole, Abbonizio, Vagnozzi, And Furman 

 Are Acting With The Requisite Scienter For Violations Of 

 Securities Act Section 17(a)(1) and Exchange Act Section 10(b)(5)  .................. 65

f. Negligence Is Easily Demonstrated As To All Defendants For 

 Violations of Securities Act Sections 17(a)(2) and (3)  ......................................... 67

g. The “In Connection With” Requirement Is Easily Met ........................................ 67

h. The Defendants’ Conduct Involved Interstate Commerce ................................... 68

C. The Defendants Are Likely to Continue to Violate the Securities Laws...................... 68

VII. RELIEF REQUESTED 

A. An Ex Parte Temporary Restraining Order is Necessary ............................................... 72

B. An Ex Parte Freeze of Assets Is Necessary ............................................................................ 73

C. Sworn Accountings................................................................................................................... 76

D. An Order Prohibiting the Destruction of Records and Expediting Discovery ........... 76

VIII. CONCLUSION ........................................................................................................................... 77

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I. INTRODUCTION 

This case concerns a web of unregistered, fraudulent securities offerings that have raised 

more than $490 million from 1,200 investors nationwide. At the center of this web are Lisa 

McElhone and her husband, convicted felon Joseph W. LaForte, a/k/a Joe Mack, a/k/a Joe Macki, 

a/k/a Joe McElhone. The McElhone-LaForte duo is in the business of making opportunistic loans 

– some of which charge more than 400% interest – to small businesses across America. They offer 

the loans through a company they control, Complete Business Solutions Group, Inc. d/b/a Par 

Funding (“Par Funding”). 

To fuel the Par Funding loans and enrich themselves, the Defendants operate a scheme 

wherein they raise investor money through unregistered securities offerings. From August 2012 

until approximately December 2017, Par Funding primarily issued promissory notes and offered 

them to the investing public directly and through a network of about sales agents. 

This changed in early January 2018, when Par Funding learned it was under investigation 

by the Pennsylvania Department of Banking and Securities for violating state securities laws 

through its use of unregistered agents. In February and October 2018, Par Funding told the 

Pennsylvania Securities Regulators it had terminated its agreements with the unregistered sales 

agents. This was only half of the story. 

In truth and unbeknownst to the Pennsylvania Securities Regulators, after learning of the 

investigation Par Funding implemented a new way to fuel its loans – namely, through so-called 

“Agent Funds” created for the purpose of issuing their own promissory notes, selling the notes to 

the investing public through unregistered securities offerings, and funneling investor funds to Par 

Funding. Par Funding compensates the Agent Funds by issuing Par Funding promissory notes to 

the Agent Funds offering higher rates of return than what the Agent Funds are obligated to pay 

investors under the Agent Funds’ promissory notes. Par Funding has more than 40 Agent Funds 

operating today. 

McElhone and Laforte orchestrate the scheme through Par Funding and McElhone’s 

company, Full Spectrum Processing, Inc., whose employees and officers operate Par Funding. 

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LaForte, Full Spectrum CFO Joseph Cole Barleta, a/k/a Joe Cole, and Par Funding investment 

director and partial owner Perry S. Abbonizio solicit investors to invest in the securities. 

Dean J. Vagnozzi, through his company ABetterFinancialPlan.com d/b/a A Better 

Financial Plan, recruits individuals to create the Agent Funds, offering them the opportunity to 

open a turnkey Agent Fund that issues and sells securities, complete with training, marketing 

materials, and an “Agent Guide,” as well as a Private Placement Memorandum, corporate 

registration, and offering materials provided by Vagnozzi’s attorney. Vagnozzi manages the 

Agent Funds through his company ABFP Management Company, LLC, and Abbonizio oversees 

and coordinates the Agent Funds. 

Vagnozzi, Michael C. Furman, and John Gissas each operate Agent Funds that raise money 

for Par Funding through unregistered securities offerings. Vagnozzi operates ABFP Income Fund, 

LLC and ABFP Income Fund 2, L.P., which issue, offer, and sell promissory notes and limited 

partnership interests to investors. Furman, through his company United Fidelis Group Corp., 

operates and manages Fidelis Financial Planning LLC, which issues, offers, and sells promissory 

notes to investors; and Gissas, through his company Retirement Evolution Group, LLC, operates 

Retirement Evolution Income Fund LLC and RE Income Fund 2, LLC, both of which issue, offer 

and sell promissory notes to investors. 

The fraudulent scheme operates behind multiple veils of secrecy built of the Defendants’ 

lies to conceal: (1) the true nature of Par Funding’s loan practices; (2) Par Funding’s true track 

record of issuing loans and the default rates of the loans; (3) the safety of investing in Par Funding’s 

loans; (4) LaForte’s criminal record, identity, and control of Par Funding; (5) three Cease-andDesist Orders state securities regulators have entered against PAR Funding for violating state 

securities laws; (6) the true result of the New Jersey Division of Securities’ investigation of Par 

Funding; (7) the fact that contrary to Par Funding’s representations to the Commission in its filings, 

it diverts investor funds to McElhone and Cole, Par Funding’s CFO, and also funnels money to 

L.M.E. 2017 Family Trust, which is McElhone’s family trust; (8) the fact that contrary to his 

representations to investors, LaForte has never invested in Par Funding; (9) a Cease-and-Desist 

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Order and sanctions issued against Vagnozzi for violating state securities laws in connection with 

the Par Funding offering; (10) a Cease-and-Desist Order and sanctions issued against ABFP for 

violating state securities laws in connection with the Par Funding offering; and (11) a Cease-andDesist Order and sanctions issued against Abbonizio for violating state securities laws in 

connection with the Par Funding offering. 

These lies, and the scheme the Defendants employ to perpetuate them in the unregistered 

securities offerings, form the basis of this action. Each Defendant plays a critical and substantial 

role in the fraudulent scheme to misrepresent and conceal the truth. Each individual Defendant 

solicits investors to purchase securities – either through an Agent Fund or directly from Par 

Funding – by scheming and lying. And it continues to this day. 

The Defendants’ ongoing violations are egregious, and the Defendants have demonstrated 

they have no respect for the securities laws, investor funds, or the truth. There is grave concern 

that without the emergency relief requested, investor funds will be dissipated. Many of the 

individual Defendants are currently in the process of arranging financing and other details in their 

bid to acquire a bank in Dallas, Texas. Further, Par Funding recently transferred most of the 

proceeds in its bank account to the bank account held by another entity in Georgia. 

Additionally, Par Funding, Vagnozzi, and Furman recently convinced investors to abandon 

their promissory notes and enter into new “Exchange Notes” offering investors a fraction of the 

investment returns, claiming Par Funding is insolvent or otherwise cannot make even monthly 

interest payments to investors due to a decrease in revenue caused by the COVID pandemic – thus 

allowing Par Funding and the Funds to retain more of the investment proceeds at the expense of 

the investors. Meanwhile, Par Funding, LaForte, Cole, Furman, and Abbonizio are continuing to 

solicit new investors and offering higher rates of return to these individuals while telling the new 

investors Par Funding is financially “pretty healthy.” While the investors are now receiving lower 

interest returns under the “Exchange Notes,” the Defendants have profited from the securities 

offerings. As with nearly every aspect of its operation, Par Funding has concealed the truth about 

executives’ compensation. Even from the Commission. In filings with the Commission, Par 

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Funding has falsely indicated that McElhone and Cole are not receiving offering proceeds. 

McElhone has control over the Par Fund bank accounts and Cole is the CFO who signed the most 

recent Commission filing claiming he and McElhone were not receiving proceeds – despite the 

fact that he was siphoning off millions for his own benefit and that of McElhone. 

The Defendants have a history of concealing, ignoring, and/or attempting to circumvent 

Orders issued by State Securities Regulators enjoining their securities law violations. Less than 

two weeks ago, Vagnozzi consented to a Commission Order based on securities violations in 

connection with four other offerings unrelated to the instant case. Within days of that Order being 

issued, Vagnozzi and ABFP issued a press release and emailed Par Funding investors to announce 

he intends to structure a public offering and that “[m]y staff and I feel that the results of this 

[Commission] investigation are the absolute best reason someone should invest with us....” 

Based on the ongoing nature of the Defendants’ violations and the scienter the Defendants 

have demonstrated through their willful and wanton disregard for the federal securities laws, the 

Defendants have shown they will continue to violate the law unless the Court grants the emergency 

relief the Commission seeks: (1) a Temporary Restraining Order against all Defendants; (2) an Order 

to Show Cause Why a Preliminary Injunction Should Not be Granted; (3) an Asset Freeze Order; (4) 

an Order Requiring Sworn Accountings; (5) an Order Prohibiting the Destruction of Documents; and 

(6) an Order Expediting Discovery. Simultaneously, the Commission is filing a separate motion 

seeking the appointment of a Receiver to further protect investors. 

II. DEFENDANTS AND RELIEF DEFENDANT 

A. Defendants 

1. The Par Funding Entities and Employees 

a. Complete Business Solutions Group d/b/a Par Funding 

Par Funding is a Delaware company Lisa McElhone and her husband, Joseph LaForte, 

started in 2011,1

 which had its main office in Philadelphia until 2017 and currently has its sole 

                                                            

1 Exhibit 6, Corporate Records; Exhibit 17, December 2019 LaForte Deposition, at 39:12-21; 

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office in Palm Beach Gardens, Florida.2 From no later than August 27, 2013 through present, Par 

Funding has done business using the fictitious name Par Funding.3 Par Funding provides shortterm loans to small businesses and claims to have funded more than $600 million in loans.4

 Lisa 

McElhone is Par Funding’s President and sole employee.5 McElhone has ultimate decisionmaking authority for Par Funding.6

 The L.M.E. 2017 Family Trust, for which McElhone is the 

Grantor, is Par Funding’s sole owner.7 

 In 2018, the Commonwealth of Pennsylvania; acting through the Department of Banking 

and Securities, Bureau of Securities Compliance and Examinations (''Bureau"), conducted an 

investigation of certain securities-related activities of Par Funding.8 Based on the results of its 

investigation, the Bureau concluded that Par Funding violated the Pennsylvania Securities Act of 

1972, 70 P .S. § 1-301. (“Pennsylvania Securities Act").9

 On November 28, 2018, Par Funding 

consented to the entry of an Order by the Pennsylvania Department of Banking and Securities 

imposing a $499,000 administrative assessment for violations of the Pennsylvania Securities Act 

through the use of an unregistered agent to offer and sell Par Funding notes in Pennsylvania.10 

On December 27, 2018, the New Jersey Bureau of Securities issued a Cease and Desist 

Order against Par Funding, based on Par Funding’s sale of unregistered securities in New Jersey 

and use of unregistered agents, in violation of the New Jersey securities laws.11 

On February 25, 2020, the Texas State Securities Board issued an Emergency Cease and 

Desist Order against Par Funding and others, based on fraud and registration violations, and that 

                                                            

2 Exhibit 11, 2020 Par Funding Form D Filing; Exhibit 3, Deposition of Cole, at 157:10-21; 

Exhibit 4, Par Funding Deposition, at 172:6-8. Exhibit 17, LaBarre Deposition, at 60:8-13. 

3 Exhibit 7, PA Fictitious Name Filing, at p.1. 

4 Exhibit 43, Par Funding website capture, at pdf page 19 of 31; Exhibit 25, Renee Meyer 

Declaration, at ¶ 22 and Exh. E thereto (see pdf page 91 of 126). 

5 Exhibit 4 at 172:21-173:2; Exhibit 3, 154:10-159:12. 

6 Exhibit 3 at 224:17-225:16. 

7 Exhibit 3, at 109:6-110:2. 

8 Exhibit 77, Declaration of Lori Boyogueno, Exh. A thereto. 

9 Exhibit 8, Certified copy of Pennsylvania Cease-and-Desist Order, at introductory paragraph.

10 Id. at ¶¶ 8-9. 

11 Exhibit 9, Authenticated December 2018 New Jersey Order against Par Funding. 

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matter is in active litigation.12 The Order finds that the respondents engaged in fraud for failing to 

disclose to investors the Pennsylvania and New Jersey Orders against Par Funding, the identity 

and management of Par Funding, and lawsuits filed against Par Funding for its lending practices.13

b. Full Spectrum Processing, Inc. 

Full Spectrum is a Pennsylvania company created in 2016 and its primary place of business 

is in Philadelphia, Pennsylvania.14 Lisa McElhone is the sole owner of Full Spectrum.15 Since 

2017, McElhone has used Full Spectrum to operate Par Funding, which has no employee other 

than McElhone.16 Full Spectrum is interchangeable with Par Funding, and operates Par Funding.17 

c. Lisa McElhone 

McElhone is a Florida resident.18 She created Par Funding,19 is its Chief Executive 

Officer,20 President21 and sole employee,22 and is also the sole owner of Full Spectrum.23 

McElhone is a signatory on all Par Funding bank accounts.24 On August 1, 2012, the Director for 

the Department of Consumer and Business Services for the State of Oregon issued a Cease-andDesist Order against McElhone for providing debt management services without registering as a 

debt management services provider, in violation of the Oregon Mortgage Lender Law and Oregon 

statutes.25 McElhone consented to a permanent Cease-and-Desist Order on October 13, 2013.26 

Between July 2015 and October 2019, she received at least $11.3 million from Par Funding.27 

                                                            

12 Exhibit 37, Certified February 2020 Texas Emergency Cease and Desist Order. 

13 Id. at ¶¶ 61-70. 

14 Exhibit 1, Certified Pennsylvania Business Records. 

15 Exhibit 4, Par Funding 30(b)(6) Deposition, at 56:2-18. 

16 Id. at 52:18-53:19; 172:6-173:2.

17 Exhibit 98. 

18 Exhibit 3, at 158:2-159:1; Exhibit 11, Par Funding Form D filed in 2020. 

19 Exhibit 6. 20 Exhibit 12, Lisa McElhone Linked In Profile. 

21 Exhibit 4 at 172:21-173:2. 

22 Exhibit 3, at 157:23-158:4. 

23 Exhibit 4, at 56:2-18. 

24 Exhibit 13, Declaration of Melissa White. 

25 Exhibit 13, Certified Oregon Cease-And-Desist Order. 

26 Id. 

27 Exhibit 13 at ¶ 12. 

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d. Joseph La Forte, a/k/a Joe Mack, a/k/a Joe Macki, a/k/a Joe McElhone 

LaForte is a resident of Philadelphia, Pennsylvania28 and the spouse of Lisa McElhone,29

with whom he founded Par Funding.30 LaForte uses the aliases Joe Mack, Joe Macki,31 and Joe 

McElhone.32 LaForte claims to be the owner of and to have started Par Funding,33 and he runs the 

day-to-day operations.34 LaForte acts as the de facto CEO of Par Funding and Full Spectrum 

Abbonizio introduces LaForte to investors as Par Funding’s president.35 LaForte also serves as 

Par Funding’s Director of Sales through his employment with Recruiting and Marketing 

Resources.36 He works in the Full Spectrum office space in Philadelphia.37 From 1995 until 2000, 

LaForte worked for various broker-dealers.38 He obtained Series 7 and Series 63 securities licenses 

in 1996 and a Series 24 securities license in 1997; however, these licenses have expired.39 LaForte 

has never been registered with the Commission in any capacity.40

On October 4, 2006, LaForte was convicted of state charges in New York for grand larceny 

and money laundering, and on November 8, 2007 he was sentenced to three to ten years in prison 

and to pay restitution in the amount of $14.1 million.41 In 2009, LaForte pled guilty to federal 

criminal charges in the District of New Jersey for conspiracy to operate an illegal gambling 

                                                            

28 Exhibit 17, at 39:19-40:1. 

29 Id. at 39:12-15. 

30 Exhibit 3, at 242:18-243:20; Exhibit 136, Transcript of Meeting, at 43:22-44:1. 

31 Exhibit 17 at 74:6-16; Exhibit 18, Declaration of Kara DePietro, at ¶ 3 and pdf pg.9; Exhibit 

19, Declaration of Michael Foti, at. 

32 Exhibit 136 at 43:22-44:1.

33 Exhibit 27, Declaration of Christine Rainwater, authenticating Nov. 16, 2018 email from “Joe 

Mack;” Exhibit 28, at ¶¶ 2 & 3 and Exh. A thereto. See also Exhibit 20, Transcript of November 

2019 Sales Dinner, at 58:15-20, 60:12-17. 

34 Exhibit 98, Declaration of Loniese Jones. 

35 Id.; Exhibit 20, at 52:5-8 (referring to the subsequent speaker as the president of the company. 

36 Exhibit 3, at 163:24-164:6, 164:21-165:5, 321:11-18. 

37 Exhibit 98; Exhibit 3, at 20:15-22:5. 

38 Exhibit 32, CRD for LaForte, with FINRA certification. 

39 Id. at p.8. 

40 Exhibit 21, SEC Attestation regarding Joseph LaForte. 

41 Exhibit 17, at 132:2-133:23; Exhibit 31, Certified records, Rice v. Joseph W. LaForte, et al,

Index No. 05-018891 (NY Supreme Court, Nassau County).. 

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business.42 He was released from jail in February 201143 and, as set forth above, founded Par 

Funding with McElhone in 2011, which occurred shortly thereafter while on supervised release.44 

e. Joseph Cole Barleta a/k/a Joseph Cole a/k/a Joe Cole 

Cole is a resident of Philadelphia, Pennsylvania.45 He was employed by Par Funding as its 

CFO until 2017, when all Par Funding employees were converted to Full Spectrum employees.46 

Since 2017, he has been employed by Full Spectrum as Full Spectrum’s CFO,47 and through his 

employment at Full Spectrum has functioned as the CFO of Par Funding from 2017 through 

present.48 From July 2019 until October 2019, Cole has received at least $ 1,759,136.42 from Par 

Funding through payments, which included investor funds, to his company ALB Management 

Inc.49 An additional amount of about $14.4 million was transferred from Par Funding to Beta 

Abigail and New Field Ventures, LLC, companies in which Cole has an ownership or other 

beneficial interest, between July 2016 and November 2019.50 

f. Perry S. Abbonizio 

Abbonizio lives in Pennsylvania.51 He claims to be an owner and managing partner of Par 

Funding52 and he is responsible for bringing investment capital into Par Funding.53 He helps 

recruit and train Par Funding’s Agent Fund managers,54 provides information to potential investors 

                                                            

42 Exhibit 33, Plea Agreement, United States v. Joseph LaForte, Case No. 09-cr-00941 (N.J.D.). 

43 Exhibit 35, Declaration from Ray Andjich. 

44 Exhibit 34, Judgment against LaForte showing term of supervised release, at p.3; Exhibit 6, 

showing date Par Funding was incorporated. 

45 Exhibit 11. 46 Exhibit 3 at 13:15-14:4. 

47 Id. at 14:2-4, 

48 Id. at 14:5-15:8. 

49 Exhibit 13 at ¶ 13; Exhibit 132, Transcript of UC Undercover Meeting, at 123:4-15. 

50 Exhibit 13 at ¶¶ 14-15; Exhibit 131, Par Funding Audited Financial Statements, at pdf page 20 

(“Beta Abigail and New Field Ventures, LLC, Inc. are owned in part by the Company’s Chief 

Financial Officer and Director of Investor Relations.”). 

51 Exhibit 22. 52 Exhibit 23; Exhibit 152, Transcript of January 16, 2020 Texas Board of Securities investigator 

call with Abbonezio, at 2:5-7, 3:15-4:1, and 4:23-5:1; Exhibit 136, at 44:16-17. 

53 Exhibit 85, Transcript of Undercover Par Funding Solicitation, at 136:5-10. 

54 Exhibit 24, Transcript of Beasley Deposition, at 6:6-13:7. 

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about Par Funding,55 oversees the Agent Funds, and solicits investors.56 From February 2017 until 

October 2019, Par Funding paid Abbonizio at least 9,499,161.52 through his entity “New Field 

Ventures, LLC.”57 Abbonizio held Series 7, 63 and 65 securities licenses that have expired.58 

From 1996 until 2015, Abbonizio was associated with various securities broker-dealers.59 

In 2015, the Financial Industry Regulatory Authority (“FINRA”) sanctioned Abbonizio by consent 

in a regulatory action resulting in a four-month license suspension and $10,000 fine based on 

allegations that without providing notice to his FINRA member firm, he solicited his firm clients 

to purchase $625,000 in outside private placements and received compensation without firm 

knowledge/permission.60 In February 2020, the Texas Securities Board issued an Emergency 

Cease-And-Desist Order against Abbonizio for fraud violations in connection with the offer and 

sale of Par Funding promissory notes.61 

2. The “A Better Financial Plan” Companies and Owner 

a. Dean J. Vagnozzi 

Vagnozzi lives in Pennsylvania and is the owner of ABFP and ABFP Management.62 He 

held Series 6 and 63 securities licenses, which have expired, and was associated with a FINRAregistered securities broker-dealer from February 2008 until February 2009.63 In addition to 

operating the ABFP entities and funds, Vagnozzi solicited investors to invest in Par Funding 

promissory notes pursuant to a so-called “finders agreement” from about August 2016 until 

December 2017.64 Since January 2018, he also recruited individuals to start Agent Funds for the 

                                                            

55 Exhibit 3 at 316:20-318:5. 

56 Exhibit 18; Exhibit 20 at 49:9-59:9; Exhibit 25; Exhibit 136 at 6:19-7:21. 

57 Exhibit 13 at ¶ 15; Exhibit 132, Transcript of UC Undercover Meeting, at 123:4-20. 

58 Exhibit 36, Abbonizio CRD. 

59 Id.

60 Id.

61 Exhibit 37, Texas Cease-And-Desist Order 

62 Exhibit 40, at 11:12-14:22; 89:11-14. 

63 Id. at 31:11-32:4; 41:2-9. 

64 Exhibit 159, Vagnozzi 2019 transcript, at 364:25-365:19; Exhibit 78, Finders Agreements, at 

pdf page 2; Exhibit 116; Exhibit 122. 

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purpose of raising money for Par Funding, and has at least 30 individuals nationwide operating 

these investment firms which he manages through ABFP Management.65 

On May 30, 2019, Vagnozzi, doing business as ABFP, entered a settlement with the 

Pennsylvania Department of Banking and Securities in connection with the sale of promissory 

notes Par Funding offered and sold. In connection with that case, Vagnozzi agreed to pay a penalty 

of $490,000 for violations of the Pennsylvania Securities Act of 1972, 70 P.S. § 1-101, et. 

Seq.66 On July 14, 2020, the Commission instituted settled administrative proceedings with 

Vagnozzi for his offering and selling unregistered securities in violation of Section 5 of the 

Securities Act and acting as an unregistered broker-dealer in violation of Section 15(a) of the 

Exchange Act, in connection with the sale of securities unrelated to the instant case.67

b. ABFP Management Company, LLC 

ABFP Management is a Delaware limited liability company located in Collegeville, 

Pennsylvania.68 It is wholly owned by Dean Vagnozzi.69 It is engaged in the business of, among 

things, providing management services related to organizing and operating companies formed for 

the purpose of raising funds from investors and using the investor funds to invest in alternative 

investments.70 ABFP Management provides these and other management services for the Par 

Funding Agent Funds in exchange for a portion of the investment returns.71 

c. Abetterfinancialplan.com d/b/a A Better Financial Plan (“ABFP”) 

ABFP is a Pennsylvania limited liability company Vagnozzi formed on November 12, 

2010.72 It is located in King of Prussia, Pennsylvania.73 Vagnozzi owns and manages ABFP, and 

                                                            

65 Exhibit 156, Texas Recording of Conversation with Beasley, June 13, 2019, at 4:16-6:18. 

66 Exhibit 57, Pennsylvania Order against Vagnozzi. 

67 Exhibit 160, Order, In the Matter of ABetterFinancialPlan.com LLC d/b/a A Better Financial 

Plan and Dean J. Vagnozzi, Securities Act Release No.10802 (July 14, 2020). 

68 Exhibit 29, Certified records for A Better Financial Plan Capital Management, LLC. 

69 Exhibit 40, November 15, 2018 Testimony of Dean Vagnozzi, at 14:13-22. 

70 Exhibit 41, ABFP Management’s Management Agreement with Fidelis Financial, at ¶2. 

71 Exhibit 41; Exhibit 42, Merchant Growth Investment Fund Management Agreement. 

72 Exhibit 44, Certified records for abetterfinancialplan.com, LLC. 

73 Id. 

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he claims it is his corporate alter ego.74 ABFP is an investment firm that offers alternative 

investments involving assets unrelated to the stock market.75 ABFP has been soliciting investors 

for Par Funding since no later than April 4, 2017.76 ABFP has never been registered with the 

Commission.77 In February 2020, the Texas Securities Board issued an Emergency Cease-AndDesist Order against ABFP for fraud violations in connection with the offer and sale of Par Funding 

promissory notes.78 On July 14, 2020, the Commission instituted settled administrative 

proceedings with ABFP for its violations of Section 5 of the Securities Act and Section 15(a) of 

the Exchange Act in connection with the sale of securities unrelated to the instant case.79

d. ABFP Income Fund, LLC 

ABFP Income Fund is a Delaware limited liability company created by Vagnozzi on 

January 12, 2018, with a principal place of business in King of Prussia, Pennsylvania.80 ABFP 

Income Fund claims that beginning no later than February 2, 2019, raised at least $22 million for 

Par Funding through the offer and sale of promissory notes to at least 99 investors.81 ABFP Income 

Fund has never been registered with the Commission.82

e. ABFP Income Fund 2, L.P.

ABFP Income Fund 2 is a Delaware limited partnership formed in 2018 with its principal 

place of business in King of Prussia, Pennsylvania.83 Vagnozzi, through ABFP Management, 

formed ABFP Income Fund 2 for the purpose of raising investor money to pool and invest in the 

promissory notes of merchant cash advance companies,84 and specifically Par Funding. ABFP 

                                                            

74 Exhibit 40, at 12:14-24; 56:7-25 

75 Exhibit 46, ABFP website; Exhibit 37, Certified copy of February 2020 Texas Emergency 

Order Including Findings. 

76 Exhibit 52, ABFP Form D Filing.

77 Exhibit 47, SEC Attestation for ABFP. 

78 Exhibit 37, Texas Cease-And-Desist Order 

79 Exhibit 160, July 14, 2020 Order. 

80 Exhibit 39, Certified Delaware Records for ABFP Investment Fund. 

81 Exhibit 52, Authenticated Form D Filing by ABFP Income Fund. 

82 Exhibit 49, SEC Attestation for ABFP Income Fund. 

83 Exhibit 50, ABFP Income Fund 2 Form D Filing. 

84 Exhibit 55, ABFP Income Fund 2 PPM at BFP062538 (“Fund” and “Offering” Sections). 

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Management is the General Partner of ABFP Income Fund 2.85 According to its Commission 

filings, beginning no later than August 8, 2018, Vagnozzi has raised at least $6 million for Par 

Funding, through the offer and sale of limited partnership interests in ABFP Income Fund II to at 

least 49 investors.86 ABFP Income Fund II has never been registered with the Commission.87

3. The Florida Investment Firms, Agent Funds, and Owners 

a. Michael Furman 

Furman is a resident of West Palm Beach, Florida.88 He is the President of Fidelis 

Financial, which he manages through his company United Fidelis Group.89 Furman is a certified 

public accountant licensed in Pennsylvania.90 

b. United Fidelis Group LLC 

United Fidelis Group is a Delaware limited liability company formed on April 5, 2018.91 

Furman owns and operates United Fidelis Group.92 United Fidelis Group has never been registered 

with the Commission.93

c. Fidelis Financial Planning LLC 

Fidelis is a Delaware Limited Liability Company formed in April 2018 and its principal 

address is in West Palm Beach, Florida.94 Michael Furman is the President of Fidelis95 and United 

Fidelis Group is the sole manager of Fidelis.96 ABFP Management provides management services 

to Fidelis.97 Fidelis is a pooled financial fund98 created for the purpose of raising investor funds 

                                                            

85 Id. 

86 Exhibit 50, Certified Form D filing by ABFP Income Fund 2. 

87 Exhibit 57, SEC Attestation for ABFP Income Fund 2. 

88 Exhibit 66. 89 Exhibit 62, Fidelis PPM, at pp.3, 4, 8. 

90 Exhibit 65, Furman CPA License record, with authenticating declaration. 

91 Exhibit 63, Certified corporate records from State of Delaware for United Fidelis Group. 

92 Exhibit 62, Fidelis PPM, at p.8. 

93 Exhibit 67, SEC Attestation regarding United Fidelis Group. 

94 Exhibit 61, Certified corporate records from State of Delaware for Fidelis; Exhibit 64. 95 Exhibit 62, Fidelis PPM, at p.4. 

96 Exhibit 62, Fidelis PPM, at p.3. 

97 Exhibit 41, Management Services Agreement between Fidelis and ABFP Management. 

98 Id. 

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for Par Funding. Since no later than August 9, 2018, Fidelis has raised more than $5.8 million 

from investors through the offer and sale of promissory notes.99 Fidelis has never been registered 

with the Commission.100

d. John Gissas 

Gissas is the President of Retirement Evolution.101 He has never been registered with the 

Commission in any capacity. 

e. Retirement Evolution Group, LLC 

Retirement Evolution is a Florida limited liability company formed by John Gissas in April 

2018, with its principal address in Wildwood, Florida.102 

f. Retirement Evolution Income Fund f/k/a RE Income Fund (“RE Income Fund”)

RE Income Fund is a Delaware limited liability company formed in 2018 with its principal 

address in Wildwood, Florida.103 Since as early as May 2018, it has raised more than $5.4 million 

from at least 62 investors through the offer and sale of promissory notes.104

g. RE Income Fund 2 LLC 

RE Income Fund 2 is a Delaware Limited Liability Company formed in 2019.105 Its 

principal address is in Wildwood, Florida.106 Gissas is its President and sole manager.107 RE Fund 

2 is a pooled investment fund created for the purpose of raising funds for Par Funding. 108 Since 

no later than August 1, 2019, RE Fund 2 has raised at least $150,000 from investors through the 

offer and sale of promissory notes.109 

 

                                                            

99 Exhibit 64, Form D Filing for Fidelis Financial; Exhibit 62. 

100 Exhibit 68, SEC Attestation regarding Fidelis. 

101 Exhibit 101; Exhibit 54. 102 Exhibits 54 & 59. 103 Exhibit 58. 104 Id.; Exhibit 59. 105 Exhibit 45, Form D Filing; Exhibit 101 and Exh. C thereto. 

106 Id. 

107 Exhibit 101 at pdf pages 25, 26 & 31 of 66, Exhibit 145, RE Fund 2 Form D. 

108 Exhibit 101, Exhibit 145, RE Fund 2 Form D; Exhibit 162, RE Fund 2 PPM. 

109 Exhibit 145. 

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B. Relief Defendant 

LME 2017 FAMILY TRUST (the “Trust”), as set forth above, owns PAR Funding and 

McElhone is the Grantor of the Trust. Between July 2018 and September 2018, Par Funding 

transferred at least $14.3 of investor funds to the Trust for no legitimate purpose.110

III. JURISDICTION AND VENUE 

The Court has jurisdiction over this action pursuant to Sections 20(b), 20(d), and 22(a) of 

the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d), and 77v(a); and Sections 21(d), 21(e), and Section 

27 of the Exchange Act, 15 U.S.C. §§ 78u(d), 78u(e), and 78aa. This Court has personal 

jurisdiction over the Defendants, and venue is proper in the Southern District of Florida, because 

many of the Defendants' acts and transactions constituting violations of the Securities Act and the 

Exchange Act occurred in the Southern District of Florida. Par Funding’s sole office is located in 

the Southern District of Florida and Lisa McElhone, the CEO of Par Funding and sole owner of 

Full Spectrum, resides in the Southern District of Florida and works in the Par Funding office 

located in the Southern District of Florida. Par Funding has also sold its promissory notes to 

investors located in Florida.111 Abbonizio has solicited Florida investors and participated in 

solicitation events and meetings in the Southern District of Florida on behalf of Par Funding and 

as a Full Spectrum employee.112 Cole is the CFO of Par Funding, which has its sole office in the 

Southern District of Florida. As set forth above, Full Spectrum operates, and LaForte and 

McElhone control, Par Funding, and Cole, Abbonizio, and LaForte have solicited investors in the 

Southern District of Florida as recently as June 2020.113 

Vagnozzi has solicited investors in the Southern District of Florida, both directly and 

through his ABFP companies and Agent Funds, and ABFP Management manages a South Florida 

Agent Fund.114 As set forth above, Furman resides in the Southern District of Florida and United 

                                                            

110 Exhibit 13 at ¶ 16. 

111 Exhibit 75, Par Funding Form D filing, 2019. 

112 Exhibit 25, Declaration of Renee Meyer; Exhibit 129. 113 Exhibit 129. 114 Exhibit 38; Exhibit 41. 

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Fidelis and Fidelis Financial are located in the Southern District of Florida. Investors residing in 

the Southern District of Florida have invested in Gissas’ Retirement Evolution funds.115

In connection with the conduct alleged in this Complaint, the Defendants, directly and 

indirectly, singly or in concert with others, have made use of the means or instrumentalities of 

interstate commerce, the means or instruments of transportation and communication in interstate 

commerce, and the mails. 

IV. THE FRAUDULENT PAR FUNDING SECURITIES OFFERING SCHEME 

A. Par Funding 

As set forth above, McElhone and her husband LaForte, a convicted felon, founded Par 

Funding in 2011 and control it together. McElhone is the President, the signatory on the Par 

Funding bank accounts, and according to the Par Funding’s most recent deposition under Federal 

Rule of Civil Procedure 30(b)(6), has ultimate authority over Par Funding. LaForte acts as the de 

facto CEO and runs the day-to-day operations.116 Also as set forth above, Cole is the CFO of Full 

Spectrum and serves in that capacity as CFO of Par Funding, and Abbonizio is a part-owner of Par 

Funding whose responsibilities include investor solicitations. 

Since no later than August 1, 2012, Par Funding has been in the business of funding shortterm loans to small-sized businesses, which Par Funding refers to as “merchant cash advances.” 

(the “Loans” or “MCAs”).117 LaForte decides which Loans Par Funding will approve and fund,118 

and, as set forth above, Par Funding has purportedly funded more than $600 million in Loans.

Some of Par Funding’s Loans carry interest rates of more than 400%.119 According to a recent 

expert witness analysis of the Loans issued to Texas small businesses, more than half of the Loans 

charge in excess of 95% interest.120 Since 2013, Par Funding has filed more than 2,000 lawsuits, 

                                                            

115 Exhibit 161. 116 Exhibit 98. 117 Exhibit 70; Exhibit 71; Exhibit 25 at Exh. E thereto. 

118 Exhibit 98. 119 Exhibit 76, Expert report of Charles S. Lunden, at p. 10. 

120 Id. 

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seeking more than $300 million in missed Loan payments against small businesses who have 

allegedly defaulted on these Loans.121 To fund the Loans Par Funding raises investor money 

through the offer and sale of promissory notes.122

B. Phase 1 of The Offering: Par Funding Issues Promissory Notes Directly To Investors 

 From no later than August 2012 until December 2017, Par Funding sold promissory notes 

directly to investors.123 Par Funding issued promissory notes providing for a 12-month duration 

and stating the investor will receive a percentage of interest annually, ranging from 12% to 44%.124 

Investors signed a “Non-Negotiable Term Promissory Note” and an accompanying “Security 

Agreement” (collectively the “Par Funding Notes”).125 Defendants McElhone and Cole signed the 

Par Funding Notes on behalf of Par Funding.126 The Par Funding Notes generally provide that the 

interest is paid over twelve months, and then the investor’s principal investment is returned in full 

to the investor.127 The Security Agreement states that Par Funding grants a security interest to the 

investor in substantially all of Par Funding’s assets, including, its accounts receivable.128

. To locate and solicit investors, Par Funding contracted with sales agents through “Finders 

Agreements” Cole signed on behalf of Par Funding.129 The Finder’s Agreements provide that once 

Par Funding receives investor funds, it will pay the agent a one-time distribution.130 Beginning no 

later than Fall 2016 until December 2017, Defendant Dean Vagnozzi was one such agent for Par 

                                                            

121 Exhibit 74, Declaration of Crystal Ivory; Exhibit 73, Declaration of Ray Andjich. 

122 Exhibit 88, Letter from Par Funding, through its counsel, to Pennsylvania Securities 

Regulators, at p.2, ¶ 2; Exhibit 20, beginning at p.16. 

123 Exhibit 75, Par Funding 2019 Form D; Exhibit 71. 124 Exhibit 89, Promissory Notes and Security Agreements. 

125 Id.

126 Id.

127 Id. 

128 Exhibit 89. 129 Exhibit 78, Composite Exhibit of Finders Agreements. 

130 Id.

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Funding.131 Vagnozzi and his company A Better Financial Plan raised about $20 million for Par 

Funding132 in exchange for a commission equal to 6 or 7 percent of each investment he solicited.133 

Defendant Michael Furman also solicited investors to purchase Par Funding Notes. For 

example, in November 2017 Furman met with potential investors at his firm, United Fidelis Group, 

in West Palm Beach, Florida, and recommended the Par Funding investment.134 He told the 

potential investors that Par Funding made loans to small business and charged 36% interest on the 

loans.135 Furman distributed Par Funding marketing materials, including a brochure, and touted 

Par Funding’s management expertise and its thorough due diligence in selecting borrowers.136 

Furman also emphasized to their investors that their money would be safe and secure because the 

default rates on the Loans were 1% or less.137 

Furman told the potential investors that the percentage of interest Par Funding would pay 

on its Notes would depend on the amount invested.138 He told them the higher the investment 

amount, the higher the interest rate and thus the return.139 He explained to the potential investors 

that if they invested $300,000-$400,000, Par Funding promised to pay the investors an annual 

return of 12.5% in monthly installments over one year.140 Furman provided potential investors 

with offering materials, including the Par Funding Note. 

By December 2017, Par Funding had raised at least $482 million from investors.141 The 

investors purchased the Par Funding notes by sending funds directly to Par Funding or through 

self-directed IRA accounts.142

                                                            

131 Exhibit 159, 2019 Vagnozzi Testimony, at 364:25-365:19; Exhibit 78. 132 Exhibit 40, 2018 Vagnozzi Testimony, at 251:14-25. 

133 Exhibit 159, 2019 Vagnozzi Testimony, at 368:9-18. 

134 Exhibit 25. 135 Id. 

136 Id. 

137 Id. 

138 Id. 

139 Id. 

140 Id. 

141 Exhibit 11, 2020 Form D; Exhibit 13, Davis Declaration, at ¶ 10. 

142 Exhibit 108. 

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C. Par Funding Learns It Is Under Investigation For State Securities Law Violations 

 And Begins Efforts To Restructure Its Offering To Conceal Adverse Information 

Things changed in January 2018. On January 4, 2018, the Pennsylvania Securities 

Regulators issued a subpoena to Par Funding in connection with its investigation of Par Funding’s 

use of unregistered Agents.143 Par Funding, through its counsel, assured the Pennsylvania 

Securities Regulators that it was no longer using Agents to find investors.144

 In truth, when Par Funding made this representation it had already restructured its offering 

by converting its Agents to Agent Fund managers the Agents created under the guidance of 

Defendant Vagnozzi and Abbonizio.145 Par Funding put this structure into place in January 2018 

after receiving the Pennsylvania Securities Regulators’ subpoena and it continues to this day.146 

Under this new structure, Par Funding uses Agent Funds to offer and sell promissory notes the 

Agent Funds issue to investors. The Agent Funds then funnel investor money to Par Funding, 

which then issue Par Funding Notes to its Agent Funds.147 Below is an illustration Vagnozzi’s 

attorney showed existing investors in April 2020, explaining how the fund structure works with 

respect to the ABFP Income Fund: 

                                                            

143 Exhibit 77, January 4, 2018 subpoena. 

144 Exhibit 163 at page 2, ¶ 3 of the letter. 

145 Exhibit 164, January 11, 2018 email from Vagnozzi to “Finders” that Par Funding will only 

accept investor money through funds; Exhibit 18 at ¶ 8 and Exh. A thereto (pdf page 6) 

(“Previously, those willing to place money with CBSG did so directly. However, as Perry 

discussed, in January of this year the investment structure has changed to a fund based platform.”). 

146 Id. Vagnozzi proposed this structure in 2016 and 2017, but Par Funding only put it into place 

after it received the Pennsylvania subpoena. See Exhibit 40, at 244:19-249:5 (Vagnozzi first 

proposes fund model in 2016); Exhibit 118 (proposes it again in 2017). 

147 Exhibit 149, Transcript of Vagnozzi & his attorney speaking to investors, at 10:25-11:25; 

20:24-21:19. 

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The Agent Fund PPMs distributed to potential investors state that the Agent Fund is raising 

money to invest in a merchant cash advance or lending company, but do not disclose that this is 

Par Funding.148 Nor do the Agent Fund PPMs disclose Par Funding’s regulatory history, that Par 

Funding is managed by a convicted felon, that Pennsylvania and New Jersey Securities Regulators 

filed actions against Par Funding and there are cease-and-desist Orders against Par Funding in 

those states, or any other adverse information about Par Funding.149 While the Agent Funds offer 

investors promissory notes in the Agent Funds, investors are told that profits will be generated by 

Par Funding’s Loan business in which the Agent Funds invest.150

D. Phase 2 of the Offering: Par Funding Uses Agent Investment Funds To Raise 

Investor Money And Issues Its Notes To The Agent Investment Funds 

Since January 2018, Par Funding has raised at least $350 million through Agent Funds.151 

1. Vagnozzi and Par Funding’s Roles In Creating, Managing, and Promoting 

The Agent Funds’ Securities Offerings 

Vagnozzi is instrumental in recruiting people to start Agent Funds to provide funding to 

Par Funding. He recruits individuals to start agent funds and he trains them.152 Once Vagnozzi 

successfully recruits Agents, he and Abbonizio train them how to raise money through securities 

offerings that will ultimately fuel Par Funding. Vagnozzi teaches Agents how to open their own 

turnkey investment funds153 and provides them with an “Agent Guide” that instructs them how to 

create an Agent Fund, telling Agents they merely need to choose a name for an investment and 

send that name together with $5,000 money to Vagnozzi’s attorney, who will then set up a fund, 

gets the corporate paperwork filed, drafts a PPM for the fund, and gets a tax identification 

number.154 The Agent Guide tells the Agents which banks to use to set up bank accounts and 

                                                            

148 Exhibit 25, at Exh. C & D; Exhibit 101, at Exh. C; Exhibits 113, 162 & 165. 149 Id. 

150 Exhibit 25, at ¶ 19; Exhibit 20; Exhibit 101, at ¶¶ 16 & 20. 

151 Exhibit 13, Davis Declaration, at ¶ 9. 

152 Exhibit 24 at 6:6-13:7; Exhibit 80 (starting more funds). 

153 Exhibit 164. 154 Exhibit 110, Agent Guide. 

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directs them to add an ABFP employee as an authorized signer on the account155. According to the 

Agent Guide, ABFP Management then pays the investment expenses and payouts to the Agent 

Funds’ investors.156 In the Agent Guide, Vagnozzi tells the Agents that ABFP Management will 

handle these tasks so the Agents “to focus on selling.”157 

Par Funding, through Abbonizio, and Vagnozzi also train the Agents at Par Funding’s 

office158 and Par Funding provides the Agents with marketing materials to solicit investors.159 

Vagnozzi and Abbonizio oversee the Agent Funds160 and Vagnozzi manages them through his 

company ABFP Management in exchange for 25% of the Agent Funds’ profits.161 There are about 

40 Agent Funds raising investor money for Par Funding.162 Par Funding and ABFP coordinate the 

issuance of the promissory notes.163

Par Funding, through LaForte, Cole, and Abbonizio, help solicit investors to invest in the 

Agent Funds by speaking at events the Agent Funds organize to raise money from potential 

investors.164 Abbonizio also helps the Agent Funds solicit investors through telephone calls and 

Abbonizio, Cole, and LaForte assist by soliciting investors during meetings the Agent Funds 

arrange at Par Funding’s office.165 

                                                            

155 Id. 

156 Id. 

157 Id. 

158 Exhibit 24, Interview of Agent Fund Manager Gary Beasley at 6:6-13:7; See Exhibit 37; 

Exhibit 156 at pp.1-12 (Beasley explaining his recruitment and training) 

159 Exhibit 24, at 70:18-71:1, 106:6-107:16; Exhibit 119, Par Funding email attaching marketing 

Powerpoint brochure; Exhibit 25, at ¶¶ 20-22 & 27 and Exh. E thereto. 

160 Exhibit 152, at 2:5-4:19; Exhibit 60; Exhibit 114-116; Exhibit 119-122; Exhibit 164.G 

161 Exhibit 41, Fidelis-ABFP Management Contract; Exhibit 24,at 47:24-50:5 (Fund Manager 

Beasley explaining how they split the profits). 

162 Exhibit 152, at 2:5-4:19. 

163 Exhibits 114, 115 & 117, 120, 121, 123. 164 Exhibit 20 and exhibit thereto; Id. at Transcript of November 21, 2019 video recording, 

beginning at 16:25, Abbonizio, LaForte, and then Cole speak to investors at Vagnozzi’s 

solicitation dinner; Exhibit 101 (Abbonizio speaking at one of Gissa’s solicitation events); 

Exhibit 25 (Abbonizio speaking at one of Furman’s events). 

165 Exhibit 136 at 6:19-7:16 and 25:2-26:10; Exhibit 152; Exhibits 125 & 126.

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The Agent Funds and ABFP Management make their profits based on the rates of return 

promised in the Par Funding Notes and the Agent Fund notes with the investors. Each Agent Fund 

sends Par Funding investor funds raised through the Agent Funds’ securities offerings and upon 

receipt of the investor funds, Par Funding issues a Par Funding Note to the Agent Fund with a 

higher promised rate of rate than the Agent Fund promises to its investors in its own notes.166 Par 

Funding pays an Agent Fund its monthly returns and the Agent Fund in turn pays its investors. 

The remainder (or the spread) is for the Agent Fund, and it is obligated under an agreement it signs 

with ABPF Management to pay ABFP Management 25% from this remaining amount.167

2. Vagnozzi Offers and Sells Notes Through His Own Agent Funds 

In addition to managing Agent Funds, Vagnozzi offers and sells promissory notes through 

his own Agent Funds, ABFP Income Fund and ABFP Income Fund 2 (collectively, the “ABFP 

Funds”). The ABFP Funds each filed a Form D with the Commission giving notice of an exempt 

securities offering of either debt or equity securities in reliance on Rule 506(b).168 The ABFP 

Funds’ PPMs reflect that the ABFP Funds either enter into promissory notes with investors, 

promising annual returns as high as 15%, with monthly interest payments and full return of 

principal at the end of the typical 12-month term or sell investors interests in a limited partnership 

for $5,000 per single interest.169 The ABFP Income Fund PPM states that investor funds will be 

used to invest in promissory notes with MCA companies.170 The ABFP Income Fund 2 PPM states 

that investor money will be used 80% toward MCA promissory notes and 20% toward investment 

in one NYSE-traded equity.171 

Investors either contribute directly to the ABFP Income Funds or through a self-directed 

IRA account at a Pennsylvania-based IRA administrator. Vagnozzi directs investors to open an 

                                                            

166 Exhibit 37; Exhibit 156 at pp.1-12 (Beasley explaining his recruitment and training). 

167 Exhibit 110, Agent Guide; Exhibit 41, ABFP Management Contract. 

168 Exhibits 50 & 52.

169 Exhibit 55 at page 1; Exhibit 54 at page 1. 

170 Exhibit 165, ABFP Income Fund PPM p1. 

171 Exhibit 55, ABFP Income Fund 2 PPM p8. 

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account at the IRA administrator company, and investors contribute funds and receive their 

investment funds through this account.172

Vagnozzi and ABFP advertise the investment through radio, television ads, the Internet, 

the Facebook page for ABFP, one-on-one presentations at the ABFP office, and dinner 

seminars.173 For example, on November 21, 2019, Vagnozzi and ABFP hosted more than 300 

investors and prospective investors for a dinner where they were solicited to invest in Par Funding 

through Vagnozzi’s funds.174 Attendees were given a one-page flyer describing four investment 

opportunities, one of which was MCAs.175 The flyer described the MCA investment opportunity 

as having a 2% default rate and offering between 10-14% returns with principal returned in 1, 2, 

or 3 years.176 Vagnozzi spoke first at the November 2019 event and touted Par Funding’s financial 

success. He explained that Par Funding was buying a bank and was looking for investors to help 

– not because Par Funding couldn’t write a check to buy the bank itself, but because bank 

regulations only let Par Funding be a 5% owner.177 Vagnozzi told the attendees that “[w]e have 

stock market alternative investments that are secure...” and that the MCA investment in Par 

Funding does not have “too much risk”178 and the investment is “knocking it out of the park.”179 

Vagnozzi then introduced Abbonizio, who told the audience that Par Funding has a default 

rate of 1%, compared to an industry with an average default rate of 18.5%. Abbonizio also told 

the audience to focus on the default rate because that is the most important part of the investment. 

Abbonizio then introduced LaForte, whom he referred to as the President. LaForte told the 

audience that Par Funding is probably the most profitable cash advance company in the United 

                                                            

172 Exhibit 25, Meyer Declaration. 

173 Exhibit 128, Transcript of ABFP Solicitation Meeting; Exhibit 20 beginning at page 16; 

Exhibit 109; Exhibit 25; Exhibit 101; Exhibit 1360; Exhibit 62; Exhibit 128, at 9:8-9 (“We 

spend 18,000 on - - a week on radio.”). 

174 Exhibit 20, beginning at Transcript page 16. 

175 Id. 

176 Id.

177 Id.

178 Id.

179 Id. 

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States and maybe in the world. He also told the audience that he started the company about eight 

years ago with $500,000 of his own capital. LaForte then introduced Cole, who touted Par 

Funding’s financial health.180

During a sales pitch at ABFP’s office on December 18, 2019, ABFP staff pitched an 

individual posing as an investor. ABFP’s sales agent began by telling the potential investor that 

“What we do is not risky.”181 She explained that ABFP pools money from investors and then uses 

it to purchase a promissory note of $5 to $10 million twice a month depending on the note, and 

that investor money goes to support the company from which ABFP purchases the note.182

The ABFP sales agent described the Par Funding investment as “our probably most popular 

investment,” and explained that it pays a 10 percent monthly return.”183 She explained to the 

investor “Their business is essentially making opportunistic business loans that banks can’t make 

because they take too long, have too much underwriting,” and that they charge small businesses 

35 percent interest on the Loans.184 She explained that “Your money goes into a pool, and then it 

goes into their pool of lending, and then that pool of lending pays interest.”185 The sales agent 

touted that what is strong about the investment is its “really low default rate” of 1% on the Loans.186 

The sales agent then showed the potential investor a video in which Vagnozzi pitches the 

investment (the “Vagnozzi Par Funding Marketing Video.”). 

In the Vagnozzi Par Funding Marketing Video, Vagnozzi calls it “an investment 

opportunity like no other,” touts its double-digit growth, describes the Loans, and represents that 

they charge small businesses 35% interest, the small businesses they lend to are successful and 

financially sound, and “the Loan is usually paid back off in full in less than 100 days.”187 Vagnozzi 

                                                            

180 Id. beginning on page 16 of the transcript begins the full presentation. 

181 Exhibit 128, at 7:18-20. 

182 Id. at 11:9-12:1 and 34:2-7 (identifying the company as “Complete”) (Par Funding is a d/b/a 

for Complete Business Solutions Group); 41:2-4. 

183 Id. at 15:24-16:9. 

184 Id. at 16:10-19. 

185 Id. at 42:11-13. 

186 Id. at 16:21-17:6. 

187 Id. at 34:2-36:18. 

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goes on to explain that the MCA company gets the money it loans out from “investors like you” 

and that it is so successful “they can afford to pay you double-digit investment returns.”188 

The sales agent closed the sales pitch meeting by repeating that Par Funding has “mastered 

their underwriting so that they know who they’re lending to is legitimate. And they withdraw that 

payment every day. So they have really done a good job of protecting principal.”189

During the November 21, 2019 solicitation dinner event, Vagnozzi told potential investors 

that he has taken more than 500 investors into an investment with Par Funding,190 and by March 

2020 Vagnozzi was claiming he had 600 investors who had invested in Par Funding through 

him.191 

Through its securities offerings, ABFP Income Fund has raised at least $22 million from 

investors192 and ABFP Income Fund 2 has raised at least $6.3 million from investors through their 

unregistered offerings.193 

3. Furman Offers and Sells Notes Through His Own Agent Fund: Fidelis Financial 

Since no later than August 2018, Furman, through his companies Fidelis Financial and 

United Fidelis, has raised about $11.6 million for Par Funding through investments in Furman’s 

Agent Fund, Fidelis Financial.194 Fidelis Financial enters into promissory notes with investors, 

promising annual returns as high as 15%, with monthly interest payments and full return of 

principal at the end of the typical 12-month term.195 The Fidelis Financial PPM tells investors that 

Fidelis will invest their funds with a MCA business.196 

                                                            

188 Id. at 37:14-24. 

189 Id. at 40:8-12. 

190 Id. at 47:8-47:12. 

191 Exhibit 109 part 2, at ¶ 16 and Exh. D thereto (last paragraph on p.2; pdf page 5 of 67) 

192 Exhibit 52, ABFP Income Fund Form D Filing. 

193 Exhibit 50, ABFP Income Fund 2 Form D Filing. 

194 Exhibit 64, May 2018 Fidelis Form D filing and 2019 Amended Form D Filing. 

195 Exhibit 113, Fidelis Financial PPM p.1; Exhibit 62, Delucco Declaration; Exhibit 25, Meyer 

Declaration. 

196 Exhibit 113, Fidelis Financial PPM p.1. 

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Furman and United Fidelis advertise the investment Fidelis Financial investment through 

newspaper advertisements.197 He solicits investors via email, including by distributing the 

Vagnozzi Par Funding Marketing Video, and via telephone.198 He also puts potential investors in 

contact with Abbonizio, Cole, and LaForte, who continue the solicitation efforts.199 Furman touts 

Par Funding’s purported 1% default rate and the underwriting efforts of Par Funding, and 

emphasizes that investor money is safe and secure.200 Sometimes Furman solicits investors to 

invest in ABFP Income Fund Notes through Fidelis.201 Furman also invites potential investors to 

solicitation dinners where Furman and/or Abbonizio solicit investors and distributed a Par Funding 

marketing brochure to potential investors.202 For example, during a January 2019 sales 

presentation dinner Furman hosted in West Palm Beach, Florida, Abbonizio touted the 

management at Par Funding and the management experience there, and told potential investors the 

Loans have a 1% default rate.203 At this same dinner, investors received a Par Funding marketing 

brochure, touting that Par Funding offers insurance on all its products, and that the investment is 

protected by Par Funding’s “exceptional underwriting rigor” and “especially selective approach” 

to approving Loans.204 

Furman, through his companies, transfers investor money to Par Funding.205 Furman, 

United Fidelis, and Fidelis have raised at about $11.6 million for Par Funding through the offer 

and sale of Fidelis notes.206

 

                                                            

197 Exhibit 62, at ¶¶ 2-7; Exhibit 103, at ¶¶ 2-5 and Exh. A thereto. 

198 Exhibits 133 & 134; Exhibit 25 at ¶¶ 12-14 and Exh. B thereto. 

199 Exhibits 127, 129, 132. 200 Exhibit 25 at ¶¶ 2-11; Exhibit 103, at ¶¶ 6 & 8. 

201 Exhibit 25 at Exh. C & D thereto. 

202 Id. at ¶¶ 20-31 and Exh. E thereto; Exhibit 103, ¶¶ 2-8. 

203 Id. at ¶¶ 22 and 27-28 and Exh. E thereto (at pp. 14 and 17 of Exh. E).

204 Id. at Exh. E thereto. 

205 Exhibit 13, at Table 3. 

206 Exhibit 13, at Table 3 (amount as of December 2019); Exhibit 64 ($5,838,000 raised by May 

2019).

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4. Gissas Offers and Sells Notes Through His Own Agent Funds: 

RE Income Fund and RE Income Fund 2 

Gissas and his company Retirement Evolution raise money for Par Funding through the 

offer and sale of investments in Gissas’ Agent Funds, RE Fund and RE Fund 2.207 Gissas appears 

to primarily target investors in the The Villages retirement community in Florida.208 

Gissas and Retirement Evolution advertise the securities offerings on the RE Fund website, 

where they provide the RE Fund PPM.209 Gissas and Retirement Evolution also use newspaper 

advertisements, largely in The Villages retirement community in Florida, to invite the public to 

lunches and dinners where Gissas, sometimes with the assistance of Abbonizio, solicits the 

audience to invest in the RE Funds, which will invest in Par Funding Notes.210 

For example, in August 2019 Gissas and Retirement Evolution hosted a dinner for 12 

potential investors in Wildwood, Florida.211 Gissas gave an investor who attended the event an 

RE Fund 2 PPM and promissory note to review,212 and told the investors who attended the event 

that the investment offered an 8% to 12% investment return through an investment in an MCA 

business in Philadelphia.213 Abbonizio spoke to the investors at one of these events, where he was 

introduced as the 25% owner of Par Funding, and then touted Par Funding’s low default rate. 214 

At least one attendee at this event subsequently invested in Par Funding through the RE Fund 2 

promissory note. 215

Through the unregistered offerings, Gissas, Retirement Evolution, and the RE Funds raised 

at least $12 million from investors.216

                                                            

207 Exhibits 145, 51. 54, 58, 59, and 101. 208 Exhibit 59, Retirement Evolution Web Capture. 

209 Id. 

210 Exhibit 101, Lipowski Declaration and advertisement attached thereto, at ¶¶ 2 & 8 & Exh. A 

thereto. 

211 Id. at ¶¶ 2, 3. 

212 Id. at ¶ 17. 

213 Id. at ¶¶ 3-5. 

214 Id. at ¶¶ 8-13. 

215 Id. at ¶¶ 14 & 20-21. 

216 Exhibits 51, 58 & 145 (Form D filings listing how much offerings have raised). 

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E. Phase 3 of the Offering: Par Funding, Vagnozzi, and Furman Offer “Exchange Notes” 

On March 12, 2020, Vagnozzi forwarded investors a message he received from Cole of 

that same date. 217 According to Cole’s message, the purpose of Cole writing Vagnozzi was to 

“update our partners.” 218 In the message, Cole states Par Funding believes the Coronavirus will 

have “no long term effects to [Par Funding’s] projected growth and revenue.219 Cole further states 

in this same message that “There has been no noticeable effect to our client payments or default 

rates. We had our largest funding month by deal count in February and have confidence in being 

able to maintain consistent funding volume in the coming months.” 220

A mere two weeks later, Abbonizio and Furman forwarded investors a dramatically 

different message purporting to be from Par Funding that states “Over the past several months, Par 

Funding, like many other companies across the globe, has been severely impacted by the 

Coronavirus pandemic.”221 Par Funding goes on to say it has “been forced to close our physical 

offices” and that “virtually all of [Par Funding’s Loan borrowers] have called seeking a 

moratorium on payments and other restructured payment terms.”222 

Purportedly as the result of the Covid-19 Pandemic, some investors did not receive their 

monthly investment returns in at least March and April 2020.223 In April 2020, Furman emailed 

investors an email message purporting to be from Par Funding that states indicating that if investors 

do not accept an offering to replace their current promissory notes with “Exchange Offering Notes” 

offering significantly less interest and over a longer period of time, then Par Funding would file 

for bankruptcy.224 Par Funding, through Vagnozzi, Vagnozzi’s attorney, and Furman, presented 

investors with an offer to either restructure their promissory notes into new notes that promised 

                                                            

217 Exhibit 109, Beebe Declaration at ¶15 & Exh. D thereto. 

218 Id. 219 Id. 220 Id. 221 Id. at ¶ 15 & Exh. C thereto; Exhibit 25, Meyer Declaration, at ¶ 36 Exh. G thereto (From 

Furman). 

222 Id. 

223 Exhibit 14, at ¶ 13; Exhibit 25 at ¶¶ 35-39. 

224 Exhibit 25, at ¶¶36-39 & Exh. G (second full paragraph on page 2 of 4 of April 15 email). 

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4% annual returns and return of principal in seven years (instead of notes that promised between 

8-44% with return of principal in one year) or face non-payment on the existing notes.225

In an April 6, 2020 video Vagnozzi and Furman distributed to investors in April 2020, 

Vagnozzi’s attorney recommends that investors accept the Exchange Offering notes and tells 

investors that he reviewed the Par Funding financials and agrees the Company is insolvent.226 The 

attorney also tells investors that because Par Funding has not paid investors their returns in March, 

he obtained a UCC lien report against Par Funding and was “first in line” to collect for the 

investors.227 He emphasized to investors that this was “a key point” because “not only are we 

getting a lien, we’re getting a first position lien. So we’ll be first in line if there is a default.” 228

Public records do not reflect any such lien was filed by Vagnozzi or his attorney against Par 

Funding, but do reflect a number of other liens against Par Funding in Pennsylvania alone that 

would preclude Vagnozzi’s attorney’s purported lien from being first in line.229

In a second email distributed by ABFP in late April, Vagnozzi and his attorney repeat their 

opinions that entering into the Exchange Notes is the best option.230 The email included the 

offering materials, and in the video Vagnozzi’s attorney walks investors through the offering 

materials.231 

Based on representations by Par Funding and Vagnozzi’s messages, the representations 

that Par Funding would otherwise default on payments altogether or enter bankruptcy, and based 

on Vagnozzi’s attorney’s recommendation, as a lawyer, that they accept the offering, investors 

                                                            

225 Exhibit 109 at ¶¶ 18-19 & Exh. G thereto. Par Funding also offers Exchange Notes at this time. 

Exhibit 90.

226 Exhibit 62, at ¶¶ 11-2 and Exh. D & E thereto; Exhibit 109, at Exh. C thereto. 

227 Exhibit 62 at Exh. E thereto, 28:2-29:1. 

228 Id. 229 Exhibit 167, UCC Lien Dockets in Pennsylvania. 

230 Exhibit 109, at ¶¶ 11-12 and Exh. F & G thereto (2:2 - 4:11 in Exh. G). 

231 Exhibit 109 at ¶¶ 18-20 and Exh. G thereto (attorney walking through materials, beginning at 

4:18) and Exh. H and I thereto (offering materials). 

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opted for the Exchange Offering and entered into new promissory notes.232 Based on the 

representations made to them, investors felt they had no choice but to agree to the Exchange 

Offering and to replace their existing notes in the ABFP Funds and Fidelis Funds with new notes 

that offered less interest and thus a lower rate of return.233 Meanwhile, unbeknownst to Furman 

and Vagnozzi’s investors, the securities offerings through Par Funding, Gissas, and the RE Funds 

continued to pay investors and did not offer the Exchange Offering or interrupt monthly return 

payments to investors at all.234

F. The Securities Offerings Are Ongoing and Defendants Are Planning To Expand 

While the Defendants are telling Par Funding and Agent Fund investors that Par Funding 

is insolvent, could not afford any payments for March and April 2020, and cannot afford to pay 

investors more than 4% on the promissory notes, Par Funding, LaForte, Cole, Abbonizio, and 

LaForte have been soliciting new investors to purchase promissory notes from Par Funding – notes 

that pay a 15% return. To put this into perspective, in March 2019, a retired Palm City, Florida 

couple invested $600,000, through their retirement account, in Par Funding by purchasing a Fidelis 

Financial promissory note offering 15% interest for one year, with the return of their principal 

returned in March 2020. When the note matured in early March 2020, the retired couple invested 

in Par Funding again, this time by purchasing a $500,000 Fidelis Financial promissory note and 

Par Funding returned all but $10,000 of the retirees’ principal. On March 26, 2020, Furman 

informed the retirees that Par Funding could not afford to pay them the remaining $10,000 in 

principal it still owed them on the March 2019 promissory note, and that it could not afford to pay 

them on the March 2020 promissory note. Thus, the retirees did not receive the return of their 

principal and did not receive their monthly interest payments in March and April 2020. According 

to Furman, Par Funding, Vagnozzi, and his attorney in the emails and videos through which they 

                                                            

232 Exhibit 25, Meyer Declaration, at 35-41; Exhibit 62, DeLucco Declaration, at ¶ 14; Exhibit 

109 at ¶ 21. 

233 Id. 

234 Exhibit 101; Exhibit 25 at ¶ 44. 

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communicated to the retirees, Par Funding was on the brink of financial ruin and the best chance 

of getting paid anything was to accept a new promissory note – the Exchange Note – offering a 

fraction of the interest on the investment. In this case, the retirees would receive 4% interest rather 

than the 15% interest on the note they had purchased just weeks prior. The retirees would have to 

accept less than 1/3 of what they purchased, or face getting nothing at all. They felt they had no 

choice, and so they agreed to the Exchange Note offering.235 

This story repeats itself hundreds of time around the country, with Agent Fund and Par 

Funding investors exchanging the promissory notes they purchased for notes offering lower 

interest rates – thus allowing Par Funding to retain more of their investment funds. 

Unbeknownst to its current investors, Par Funding was, in fact, offering more investments, 

at higher interest rates of return – just to other, new investors. Specifically, Furman, LaForte, 

Abbonizio, and Cole solicited two individuals posing as investors to invest in promissory notes.236 

Contrary to representations to the retirees that Par Funding could not afford to repay their 

retirement funds with the $10,000 it owed them, the Defendants offered the new investors a 

monthly return of more than 10 times that – $125,000 – every month, for 4 years.237 In June 2020, 

LaForte told individuals posing as new potential investors that Par Funding was “pretty healthy” 

post-COVID.238 When asked about whether Par Funding had many defaulted Loans in the 

preceding months due to COVID, LaForte represented “we came out of it pretty well”239 and Cole 

told the investors that by the end of the third quarter (September), he thinks Par Funding will “be 

pretty close to where we were before.240 LaForte explained that Par Funding lowered the amount 

it was paying everyone in the PPMs and Cole explained they decided in March to “pull the plug 

on the machine... for a little bit and let - - let the cash settle.”241 In response to being asked if he 

                                                            

235 Exhibit 25, at ¶ 1 and ¶¶ 20-41. 

236 Exhibits 133, 134 & 126, 127, 129.

237 Exhibit 125. 238 Exhibit 129, Part 1 at 21:1-5. 

239 Id. at 21:6-24:3. 

240 Id. at 25:14-26:8. 

241 Id. at 177:14-179:6. 

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was ever thinking “We are in danger here because of what’s happening,” LaForte said no because 

he knew he had enough revenue in January, February, and the beginning of March to weather the 

storm and he had his “anchor clients” who continued paying their Loans.242

Thus, Par Funding is far from nearly bankrupt as they told investors in order to solicit them 

to exchange their promissory notes for the Exchange Notes under which Par Funding and the Agent 

Funds pay investors significantly less money. In fact, as LaForte divulged in June 2020, “we’re 

sitting on about $40 million in cash reserves.”243 

On about July 8, 2020, Cole emailed the individuals posing as new investors Par Funding 

promissory notes and offering materials offering a 15% interest on a $10 million investment, with 

Par Funding paying the new investors $125,000 per month beginning August 10, 2020 and 

continuing for 4 years.244 

Additionally, Gissas and Retirement Evolution appear to continue to actively solicit 

investors, with Retirement Evolution advertising in The Villages newspaper as recently as July 

2020, for a luncheon seminar about alternative investments with annual returns of 8% and 10% 

paid monthly, scheduled for the week of July 13, 2020.245 

As for Vagnozzi, three days after the Commission. entered a July 14, 2020 Consent Order 

against him and ABFP for engaging in unregistered securities offerings and acting as an 

unregistered broker-dealer in connection with offerings other than Par Funding that are not at issue 

in this case, Vagnozzi, emailed investors who had invested in Par Funding through the ABFP 

Income Funds: 

 

                                                            

242 Id. at 298:7-299:6. 

243 Id. at 258:12-13. 

244 Exhibits 124 & 125. 245 Exhibit 109, at ¶ 28. 

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 “My staff and I feel that the results of this [S.E.C.] investigation are the absolute 

best reason someone should invest with us....” 

 “[T]he SEC reviewed all of ABFP’s bank records and found that no investor funds 

were mishandled or misused. Also determined that all investments offered by 

ABFP were carried out in a manner consistent with the information provided to 

investors.” 

 “Three years of investigation, $300k spent on my end, and all they can say is they 

don’t like my advertising methods and the fact that I served steak dinners in 2013 

as a way for people to hear about our investments.”246

This is not what the Order says.247 Vagnozzi mischaracterizes the Order to investors as a 

selling point for investing with him and ABFP, and in the same email message announces that he 

is forming a non-public company that he will soon advertise.248 Vagnozzi and ABFP also issued 

a press release about the Order, claiming that “the findings of these proceedings have also paved 

the way for the company to restructure as a public company, which will alleviate advertising 

restrictions in the future.”249

G. Material Misrepresentations and Omissions in Connection with The Par Funding, 

ABFP, United Fidelis, and Retirement Evolution Offerings 

1. False Claims about Par Funding’s Rigorous Underwriting Process 

Because investor returns are purportedly generated by the interest small businesses pay on 

the Loans Par Funding makes, the success and profitability of the investment turns on Par Funding 

lending money to small businesses who pay back Loans with interest and do not default on the 

Loans. As Abbonizio explained to one individual posing as an investor at a sales pitch in January 

2020: “If you leave here and you remember nothing else. Why would I entrust the money? Because 

                                                            

246 Exhibit 109, Beebe Declaration, at ¶23 and Exh. J thereto. 

247 Exhibit 160, July 2014, 2020 Order. 

248 Exhibit 109, Beebe Declaration, at ¶23 and Exh. J thereto. 

249 Id. 

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they have an exemplary track record of underwriting, utilizing three components, taking three days 

and be more vigilant. That’s the crux of it.”250

In the Par Funding brochure that Furman and Abbonizio, and Vagnozzi, through ABFP, 

distribute to potential investors, Par Funding details its supposedly rigorous underwriting process 

to approve merchant loans, calling it “Exceptional Underwriting Rigor.”251 Par Funding claims 

that the underwriting process takes 48 to 72 hours and includes, among other things, an on-site 

inspection of each merchant before approving any Loan.252 According to the marketing materials, 

“There is no substitute for personal on-site merchant inspections,” and “Visual confirmation of a 

business’ viability yields the highest levels of confidence in the future viability of merchant 

partners.”253 Par Funding emphasizes that the on-site inspection “...has been proven to enhance 

the low default Par Funding experience[s].”254 

Furman touts the rigorous underwriting,255 and Abbonizio also touts Par Funding’s 

underwriting process to potential investors, both during one-on-one meetings with potential 

investors256 and during solicitation events.257 For example, at the November 2019 solicitation 

dinner Vagnozzi and ABFP hosted, Abbonizio told potential investors that Par Funding has 

“rigorous standards” and “the best underwriting in the industry.”258 He also touted the underwriting 

at the January 2019 solicitation dinner in West Palm Beach.259 In August, 2019, Abbonizio told 

about a dozen potential investors in The Villages that Par Funding does an on-site inspection of 

small businesses 100% of the time before approving any Loan.260 

                                                            

250 Exhibit 136, at 40:23-41:1. 

251 Exhibit 25, at Exh. E thereto (pages 9 & 11 in brochure); Exhibit 103, at ¶ 5 & Exh. C thereto 

(pages 9 & 11; pdf pp. 16 and 18 of 24 in Exhibit 103). 

252 Id.

253 Id. at p. 11. 

254 Id. 

255 Exhibit 62, at ¶ 6; Exhibit 25, at ¶ 7; Exhibit 102, at ¶ 6. 

256 Exhibit 136, at 40:23-41:1. 

257 Exhibit 103, at ¶ 6. 

258 Exhibit 20, at 51.

259 Exhibit 25, at 

260 Exhibit 101, at ¶ 12. 

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Similarly, in January 2020, Abbonizio told an undercover individual posing as an investor 

that Par Funding requires three days to complete an underwriting process on a Loan application 

because Par Funding conducts what he referred to as “the coup de grace” – a personal onsite 

inspection. He conveyed to her that because of this vigilant process, he felt confident telling her 

to invest her money in Par Funding.261 

The representations about Par Funding’s underwriting process are false. In truth, Par 

Funding does not conduct the rigorous underwriting process it claims it does.262 In reality, Par 

Funding does not always conduct on-site inspections of small businesses prior to funding Loans, 

and approves Loans in less than 48 hours.263 When Par Funding does conduct an on-site 

inspection, it sometimes does so after Par Funding has already approved and funded the Loan. For 

example, Par Funding executed a Loan agreement funded a Loan to a Texas small business on 

January 4, 2017 and that same day ordered the inspection to occur on January 5, 2017.264 Further, 

at least one small business owner’s experience was that the only time Par Funding visited his 

business, it was to threaten him with violence for missing payments.265

Contrary to the rigorous underwriting process Par Funding touts to investors, Par Funding 

approves and funds Loans to small businesses without obtaining information about the merchant’s 

profit margins, expenses, or debts.266 Even Par Funding’s representation to potential investors that 

it assigns a liaison to each merchant to cultivate the relationship is false.267 Recently, LaForte 

                                                            

261 Exhibit 136, at 37:23-41:1. 

262 Exhibit 98, at ¶¶ 2 & 4. 

263 Id.; Exhibit 91 at ¶¶ 2-6; Exhibit 92 at ¶¶ 2-5; Exhibit 93 at ¶¶ 2-5 & 7; Exhibit 94 at ¶¶ 2-5 

& 7; Exhibit 95 at 2-4 & 6; Exhibit 97 at 2-4 & 7; Exhibit 100 at ¶¶ 2-5; Exhibit 102 at ¶ 6; 

Exhibit 105 at 2-4 & 6. 

264 Exhibit 111, January 5 Inspection report, showing date ordered: January 4; Fleetwood v. 

Complete Business Solutions Group, 18-cv-00268 (E.D. Pa.), at D.E. 1-12 (“On January 4, 2017 

CBSG entered into a Factoring Agreement with Plaintiff Fleetwood Services, LLC....”). 

265 Exhibit 85, at ¶ 7. 

266 Exhibit 91 at ¶¶ 2-4 and 9-12; Exhibit 92 at ¶¶ 2-4 and 7-10; Exhibit 95 at ¶¶ 2-4 and 8; 

Exhibit 97 at ¶¶ 2-4 & 9; 2-4 and Exhibit 99 at ¶¶ 9-10; Exhibit 100 at ¶¶ 2-4 and 8-11; Exhibit 

102 at ¶¶ 2-4 and 7-9; Exhibit 105 at ¶¶ 2-3 & 8; Exhibit 106 at ¶¶ 2-4 and 8-10. 

267 Exhibit 92 at ¶ 11; Exhibit 93 at ¶ 11; Exhibit 94 at ¶ 11; Exhibit 95 at ¶ 9; Exhibit 99 at ¶ 

11; Exhibit 102 at ¶ 10; Exhibit 105 at ¶ 9. 

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admitted that Par Funding has “probably a hundred anchor clients, meaning guys who I don’t even 

have to underwrite really.” As LaForte explained these anchor clients: “They call my phone - - 

like, ‘Yeah, send me a hundred.’ And I just send a hundred.”268 Clearly, the truth was concealed 

form investors.269 

2. False and Misleading Claims about Par Funding’s Loan Default Rate 

 LaForte, Abbonizio and Vagnozzi make false claims to prospective investors that Par 

Funding has a 1% loan default rate. For example, on about June 5, 2018 LaForte met with a 

potential investor and pitched the Par Funding investment to her.270 He told her that Par Funding’s 

Loan default rate was less than 1%, and so there was virtually no risk to investment funds.271 

As set forth above, Abbonizio made numerous representations to investors about Par 

Funding’s Loan default rate of 1%. Further, on January 7, 2020, Abbonizio told an undercover 

individual posing as a potential investor that Par Funding issues bad loans 1 percent of the time.272 

He explained that the defaults are “one percent of $500 million.”273 Similarly, at a dinner for 

investors and potential investors on November 21, 2019, Abbonizio presented the investment. He 

told more 300 investors at this event that the 10% to 14% investment returns were “enticing,” but 

it is only enticing if Par Funding does a good job at loaning money to borrowers. He emphasized 

that Par Funding has “the best underwriting in the industry” that has “rigorous operational 

standards, almost seven years in the making.” Because of this, Abbonizio explained, they have a 

default rate that is “less than 1 percent.”274 He also explained to the investors why this is so 

important – because if enough of the borrowers miss their payments to Par Funding, that could 

impede Par Funding’s ability to pay Vagnozzi’s fund to ultimately pay you.”275 

                                                            

268 Exhibit 129, at 299:24-300:8. 

269 Exhibit 25 at ¶ 49; Exhibit 62 at ¶ 18; Exhibit 103 at ¶ 15.

270 Exhibit 18 at ¶¶ 9-16.

271 Id. at ¶¶ 13, 14 & 16. 

272 Exhibit 136 at 28:3-29:5. 

273 Id. at 47:21-23. 

274 Exhibit 20, Transcript attached to Horner Declaration as Exh. A, at 51:5-52:19. 

275 Id. at 52:2-4. 

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At this same dinner for 300 potential investors, Vagnozzi, through ABFP, also touted Par 

Funding’s low default rate, giving potential investors an ABFP flyer describing the Par Funding 

“merchant cash advance” investment opportunity as having a 2% default rate.276 Similarly, 

Furman and United Fidelis tout on United Fidelis’s website a 1.2% default rate for the Loan 

investment they offer, and, as set forth above Furman also tells investors Par Funding has a 1 % 

default rate during in-person meetings and solicitation events.277 

These representations are false and misleading. In reality, Par Funding has filed more than 

2,000 collections lawsuits against small business borrowers for defaulting on Loans since 2013 

alone.278 Par Funding claims to have funded $600 million in Loans.279 It has filed lawsuits seeking 

more than $300 million in defaulted Loan payments small businesses allegedly failed to repay Par 

Funding.280

In Fall 2017, Furman gave a Florida investor a Par Funding brochure claiming that Par 

Funding had provided “more than $220 million in business funding” since its inception in 2012 

and told the investor Par Funding had a 1% default rate and was a safe and secure investment.281 

However, by August 1, 2017, Par Funding had filed at least 241 lawsuits against small businesses 

for defaulting on their Loans, seeking more than $20 million in missed Loan payments – and that 

was only in the Pennsylvania Court of Pleas.282 Similarly, when Abbonizio and Vagnozzi touted 

Par Funding’s low default rates to potential investors during an ABFP solicitation dinner on 

November 21, 2019, Par Funding had filed more than 1,000 lawsuits in Pennsylvania alone, 

seeking more than $147 million in missed Loan payments from small businesses.283 LaForte and 

                                                            

276 Exhibit 20, Horner Declaration, at ¶¶ 3-4 and Exh. B & C thereto (pdf pp. 80-82). 

277 Exhibit 25 at ¶¶ 2-11; Exhibit 103, at ¶¶ 6 & 8. 

278 Exhibit 74 at ¶ 5 (Pennsylvania, New York, and a Southern District of Florida lawsuit); Exhibit 

73 at ¶ 7(a) (Pennsylvania lawsuits). 

279 Exhibit 43, Par Funding Website, at pdf p.19 of 31 (“Our growth, at a glance”); Exhibit 103, 

at ¶ 5 and Exh. C thereto (on pdf p. 13 of 24 of Exhibit 103). 

280 Exhibit 74 at ¶ 6 (total from various jurisdictions); Exhibit 75 at ¶ 7(b) (Pennsylvania lawsuits). 

281 Exhibit 25, at ¶¶ 3-8 and Exh. A thereto, p.2. 

282 Exhibit 73 at ¶ 7(c). 

283 Id. at ¶ 7(f). 

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Cole, Par Funding’s CFO, was present when these representations were made to potential investors 

on November 21, 2019, and did not correct these false and misleading statements.284 When 

Abbonizio touted Par Funding’s low default rates to an individual posing as a potential investor in 

January 2020, Par Funding had filed more than 1,200 lawsuits in Pennsylvania seeking more than 

159 million in missed payments on defaulted Loans.285 

Additionally, CFO Cole recently admitted that Par Funding calculates the default rate 

differently in its representations to investors by not including in the rate any Loan where the 

merchant is making even a partial payment or is speaking with Par Funding about the Loan.286 

Cole testified that if a merchant stops making payments on a $12 million Loan with Par Funding, 

that small business would not be disclosed in the default rate given to investors if it made even a 

$100, $200, or $500 monthly payment.287 For one small business that stopped making payments 

on a Loan to Par Funding in May 2019, Par Funding considered her in “legal default” and filed a 

Confession of Judgment against it, but did not include this default in the rate provided to investors 

until February 2020.288 For another small business borrower that Par Funding has sued for being 

in default on a $1.3 million Loan, Par Funding asked the small business owner in July 2020 to 

make a $500 payment over the phone, explaining that if the small business owner did this Par 

Funding would convert the negative $1.3 million to a positive $1.3 on the portfolio investors see.289

As is evidence in the recordings of the Defendants’ sales pitches, they do not tell investors 

that Par Funding does not include all Loans that are in default in its so-called default rate. Nor is 

there any disclosure of the more than 2,000 lawsuits Par Funding has litigated seeking more than 

$300 million in alleged missed Loan payments on the $600 million Par Funding tells investors it 

has Loaned to small business. 

                                                            

284 Exhibit 20. 285 Id. at 7(g). 

286 Exhibit 3, June 2020 Deposition, at 113:22-130:9. 

287 Id. at 116:15-117:1. 

288 Id. at 121:15-129:20. 

289 Exhibit 130 at 14:12-15:8. 

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3. False Claims that Par Funding Offers Insurance on Its Loans 

In the Par Funding brochure Par Funding distributes to potential investors through the 

Agent Funds, Par Funding claims to offer insurance on all of its products up to $150,000.290 Par 

Funding further claims that “[t]he insurance protects Par Funding in case of a default or nonpayment.”291 Furman also tells potential investors the Loans are insured and therefore protected 

in the event of default.292 LaForte has also represented to at least one investor that if a small 

business defaulted on a Loan, Par Funding had insurance to back up investor funds, thus reassuring 

the investor that her investment was safe and secure.293 

These claims are false. Par Funding did not offer small businesses insurance on the Loans, 

and thus investor funds were not protected by insurance.294 For example, during the more than 

two-year period spanning November 2015 through January 2018, Par Funding approved and 

funded 15 Loans to a small business located in Los Angeles, California (the “L.A. Small 

Business”).295 The Loans totaled $6,126,054.13. At no time, on any of the 15 Loans approved 

over the course of these two years did Par Funding offer the L.A. Small Business insurance of any 

kind. On each of the 15 occasions when Par Funding approved and funded a Loan to the L.A. 

Small Business, Par Funding completed the underwriting in less than 48 hours, never offered the 

L.A. Small Business insurance of any kind, never conducted an in-person interview before giving 

the L.A. Small Business the Loans, never requested information about the L.A. Small Business’s 

expenses, and never requested information about the L.A. Business’s profit margins. 

In sum, the representations to investors about the safety of the investment, through 

insurance and a rigorous underwriting process, are patently false.296

                                                            

290 Exhibit 25 at ¶¶ 28 & 50 and Exh. E thereto (pg.8 in brochure); Exhibit 103, at Exh. C thereto 

(p. 8 in brochure, pg.15 of 24 of the pdf).

291 Id. 292 Exhibit 103, at ¶ 6. 

293 Exhibit 18, at ¶ 14. 

294 Exhibit 91 at ¶ 7; Exhibit 92 at ¶ 6; Exhibit 95 at ¶ 5; Exhibit 97 at ¶ 5; Exhibit 99 at ¶ 6; 

Exhibit 100 at ¶ 6; Exhibit 102 at ¶ 5; Exhibit 105 at ¶ 5; Exhibit 106 at ¶ 6. 

295 Exhibit 106. 296 Exhibit 25, at ¶¶ 49-50; Exhibit 101, at ¶ 24; Exhibit 103, at ¶¶ 15-16. 

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4. Misrepresentations and Omissions about LaForte’s Background 

LaForte touts his financial and business acumen and his success through Par Funding, but 

fails to disclose his criminal history.297 Similarly, the Par Funding website includes numerous 

articles featuring LaForte and his claimed business success, and directs readers to LaForte’s 

“Forbes Council” profile, in which he describes himself as “...one of the small business industry’s 

most distinguished and accomplished leaders.”298 LaForte also holds himself out on his Linked In 

page as “one of the small business finance industry’s most distinguished and accomplished 

leaders” and claims that he “maintains a stellar reputation amongst industry professionals, clients, 

and company employees.”299 

In truth, LaForte is a twice-convicted felon and prior to founding Par Funding with 

McElhone, was imprisoned and ordered to pay $14.1 million in restitution for grand larceny and 

money laundering.300 To conceal these facts, LaForte uses several aliases – Joe Mack, Joe Macki, 

and Joe McElhone because, as LaForte admitted to at least one individual, if people “google” his 

real name they will see his negative history.301 Par Funding and Cole actively assist LaForte in 

concealing his true identity, and thus his criminal background, by providing LaForte with a Par 

Funding email address bearing the name of his alias, joemack@parfunding.com,302 and a Par 

Funding business card for his alias Joe Macki.303

Additionally, Cole has solicited at least one investor by touting the experience of Par 

Funding’s management team while failing to disclose LaForte’s criminal history,304 despite 

knowing “from the first day” that LaForte has been convicted of crimes involving dishonesty.305 

Abbonizio also touts the Par Funding management and conceals LaForte’s identity and criminal 

                                                            

297 Exhibit 18, at ¶ 3; Exhibit 20 at 56:2-62:15; 53:16- 

298 Exhibits 83 & 84. 299 Exhibit 81. 300 Exhibits 31 & 33-35. 301 Exhibit 19, Declaration of Michael Foti. 

302 Exhibit 19 at Exh. A thereto; Exhibit 18, at ¶¶ 2-3; Exhibit 3, at 318:6-16. 

303 Exhibit 19 at Exh. A. 

304 Exhibit 96, at ¶¶ 3-6 & 10. 

305 Exhibit 4, Cole Deposition, at 41:18-43:18. 

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history from investors. For example, at the November 2019 solicitation dinner, he introduced 

LaForte to the 300 potential investors and investors in attendance by telling them, “You’re going 

to hear from the president of our company in a few moments, the gentleman that does the best job 

in multi-faceted businesses of exuding operational excellence.”306 Likewise, at a Retirement 

Evolution solicitation with Gissas, Abbonizio touted Par Funding’s managerial expertise and 

“great team” Par Funding had in place, but he failed to disclose the criminal record of Par 

Funding’s de facto CEO.307 He did the same thing at a solicitation even for Fidelis Financial with 

Furman.308 Additionally, when an individual posing as an investor asked Abbonizio who the 

founders of Par Funding are, Abbonizio responded: “There’s basically five of us. There’s myself, 

Joe Cole, who is the CFO, Joel McElhone, and Lisa McElhone... and Lisa is the President of the 

company.”309 He then went on to identify the fifth founder – “a family out of Manhattan. They 

have $48 million with us.”310 Joe or Joel McElhone is yet another alias used to conceal LaForte’s 

identify from investors. Furman and Vagnozzi also tout Par Funding’s management expertise and 

experience to potential investors while failing to disclose LaForte and his criminal history.311 

In its 2019 and 2020 Form D Filings with the Commission, Par Funding failed to identify 

LaForte in the Item 3 of the form requiring the disclosure of “Related Persons.”312 The instructions 

accompanying Form D direct filers to provide the following information under “Related Persons”: 

Enter the full name and address of each person having the specified relationships 

with any issuer and identify each relationship: 

• Each executive officer and director of the issuer and person performing similar 

functions (title alone is not determinative) for the issuer, such as the general and 

managing partners of partnerships and managing members of limited liability 

companies; and 

                                                            

306 Exhibit 20, at 52:5-8.

307 Exhibit 101, at ¶¶ 10-11, 14 & 27; 

308 Exhibit 25, at ¶¶ 20-21, 25, 55. 

309 Exhibit 136, at 43:22-44:1. 

310 Id. at 44:16-22. 

311 Exhibit 25, at ¶¶ 6, 14; Exhibit 104, at ¶ 5. 

312 Exhibits 11 & 75. 

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• Each person who has functioned directly or indirectly as a promoter of the issuer 

within the past five years of the later of the first sale of securities or the date upon 

which the Form D filing was required to be made. 

 If necessary to prevent the information supplied from being misleading, also 

provide a clarification in the space provided.313

 As set forth above, LaForte is identified controls Par Funding, runs the day-to-day 

operations, and functions as an executive officer of Par Funding. Nonetheless, Par Funding fails 

to disclose LaForte’s involvement in its filings with the Commission and also during its solicitation 

of investors.314

5. Misrepresentations and Omissions about Par Funding’s Regulatory History 

LaForte touts to prospective investors Par Funding’s success. For example, in November 

2019, LaForte told about 300 potential investors that Par Funding is “probably the most profitable 

cash advance company in the United States - - or maybe the world for that matter, pound for 

pound.”315 Abbonizio solicits investors by touting Par Funding’s success and its track record as a 

leader in the merchant cash industry,316 and Furman touts Par Funding as well.317 Gissas advertises 

the Par Funding investment events by touting “the top company in the merchant cash sector.”318

Similarly, Vagnozzi touts Par Funding’s purported success. For example, in a 6-minute 

video, Vagnozzi tells potential investors he would like to introduce them to “one of the best 

merchant cash advance lenders that you can find” and characterizes it as “highly 

profitable.”319 The video is widely distributed; it is posted on the Vimeo pages of ABFP and 

Vagnozzi, emailed to potential investors, and shown during sales pitches.320 In March 2020, 

Vagnozzi described the investment in Par Funding to an individual posing as a potential investor 

                                                            

313 Exhibit 112, Form D with instructions. 

314 Exhibit 25, at ¶ 55; Exhibit 62, at ¶ 21; Exhibit 101, at ¶ 27; Exhibit 103, at ¶ 19; Exhibit 

104, at ¶ 25; Exhibit 109, at ¶ 32; Exhibit 96, at ¶ 10. 

315 Exhibit 20, at ¶¶ 3 & 4 and Exh. C thereto at 58:6-9. 

316 Exhibit 101, at ¶¶ 10 & 13; 

317 Exhibit 103, at ¶ 6; 

318 Exhibit 101, at ¶¶ 2-8 and Exh. A thereto. 

319 Exhibit 143, at 5:11-20. 

320 Exhibit 150; Exhibit 128; Exhibit 25 at Exh. B thereto (Vimeo Link at bottom of page). 

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as “like the crack-cocaine” of investments ABFP offers, adding “[a] check every month.”321 On 

the ABFP website, Vagnozzi assures potential investors that he has attorneys, accountants, and 

operations staff thoroughly vet any and all opportunities ABFP offers.322

These Defendants tout Par Funding while failing to disclose that Par Funding has twice 

been sanctioned for violating state securities laws. In November 2018, the Pennsylvania Securities 

Regulators filed a Consent Agreement and Order against Par Funding for violating the 

Pennsylvania Security Law prohibiting the use of unregistered sales agents in the offer and sale of 

securities, and fined Par Funding $499,000 (the “Pennsylvania Order”).323 In December 2018, the 

New Jersey Bureau of Securities issued a Cease-and-Desist Order against Par Funding based on 

its offer and sale of unregistered securities (the “New Jersey Order”).324 Both of these Orders were 

in effect when the Defendants touted Par Funding as an investment opportunity to potential 

investors, and both Orders remain in effect. However, Par Funding, LaForte, Abbonizio, and 

Vagnozzi have failed to disclose these Orders while touting Par Funding.325

In February 2020, the Texas State Securities Board issued an Emergency Cease-and-Desist 

Order against Par Funding and others, alleging fraud and registration violations in connection with 

its securities offering through an Agent Fund in Texas (the “Texas Order”).326 Undeterred, and as 

set forth above, Par Funding has continued soliciting investors and continued touting the success 

of Par Funding as recently as July 2020 without disclosing the Texas Order to potential investors. 

6. Misrepresentations about the New Jersey Order 

Furman has misrepresented the New Jersey Order to at least one potential investor while 

soliciting her for the Par Funding investment through Fidelis. For example, during a March 5, 

                                                            

321 Exhibit 135, at 31:5-7. 

322 Exhibit 46, at pdf page 19 (“What’s the Catch?,” last full paragraph on page cited). 

323 Exhibit 8. 324 Exhibit 9. 325 Exhibit 25, at ¶¶ 42-43; Exhibit 62, at ¶ 15; Exhibit 101, at ¶ 22; Exhibit 103, at ¶ 12; Exhibit 

104, at ¶ 18; Exhibit 109, at ¶ 24. 

326 Exhibit 37. 

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2020, with an individual posing as an investor, Furman represented that Pennsylvania sanctioned 

Par Funding, but then New Jersey determined that Par Funding had not violated the securities laws: 

New Jersey came in and fined them and then they said you're doing it right, and 

all of your books are good and we love it. We went through them, you know, and 

they retracted it and said you're good. We're not -- you know, you don't have any 

fine, you don't have any penalties, nothing.327 

This is patently false. In fact, the New Jersey Order remains in effect.328

7. False Statements In Par Funding’s Commission Filings 

About McElhone and Cole’s Receipt of Funds 

Par Funding has filed two false filings with the Commission. concerning its Par Funding 

Note offering and how investor funds would be used. On February 12, 2019, Par Funding filed a 

Notice of Exempt Offering of Securities on Form D with the Commission, stating that it was a new 

notice for an offering of debt securities in reliance on the exemption under Rule 506(b) and that 

the first sale was on August 1, 2012.329 The filing discloses approximately $3.6 million Par 

Funding has paid in finders’ fees, including to ABFP and Vagnozzi, and a total amount sold of 

approximately $227 million to 488 investors.330 In the Use of Proceeds section, the filing states 

that none of the gross proceeds of the offering has been or is proposed to be used for payments to 

executive officers or others listed in the filing’s section for related persons, in which McElhone 

and Cole are listed as executive officers and directors.331 

On April 28, 2020, Par Funding filed an amended Form D with the Commission with 

respect to the offering that began August 1, 2012, disclosing the total amount sold to the 488 

investors was higher than it initially reported in 2019 - $378 million.332 This filing states that Par 

Funding has paid no finders’ fees and commissions, and again states that none of the gross 

proceeds of the offering has been or is proposed to be used for payments to executive officers or 

                                                            

327 Exhibit 133, at 17:19-18:22. 

328 Exhibit 9. 329 Exhibit 75. 330 Id. 

331 Id. 

332 Exhibit 11. 

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others listed in the filing’s related persons section, which again includes McElhone and Cole.333 

Cole signed the Amended Form D on behalf of Par Funding.334

The representations in both filings that Cole and McElhone would not receive any of the 

gross proceeds of the securities offering are false. McElhone received at least $11.3 million from 

the offering between July 2015 and February 2020, which included investor funds.335 From July 

2019 until October 2019, Cole has received at least $ 1,759,136.42 from Par Funding through 

payments, which included investor funds, to his company ALB Management Inc.336 An additional 

amount of about $14.4 million was transferred from Par Funding to Beta Abigail and New Field 

Ventures, LLC, companies in which Cole has an ownership or other beneficial interest, between 

July 2016 and November 2019.337 As set forth above, in a recent recorded conversation with an 

individual posing as an investor, Cole admitted that Par Funding pays him through his consulting 

firms and that the amounts are reflected in the “consulting” line on the Par Funding financial 

statements.338 

Thus, contrary to Cole and Par Funding’s representations to the Commission, Par Funding 

did pay McElhone and Cole. 

8. False Claims about LaForte’s Personal Investment in Par Funding

LaForte falsely told prospective investors that he personally invested in Par Funding. For 

example, at the November 2019 solicitation dinner for ABFP, LaForte told about 300 investors 

and potential investors that he had invested $500,000 of his own money in Par Funding to start 

company.339 LaForte also claimed in an October 19, 2018 email to an existing investor inquiring 

                                                            

333 Id. 

334 Id. 

335 Exhibit 13 at ¶ 12. 

336 Exhibit 13 at ¶ 13; Exhibit 132, Transcript of UC Undercover Meeting, at 123:4-15. 

337 Exhibit 13 at ¶¶ 14-15; Exhibit 131, Par Funding Audited Financial Statements, at pdf page 

20 (“Beta Abigail and New Field Ventures, LLC, Inc. are owned in part by the Company’s Chief 

Financial Officer and Director of Investor Relations.”). 

338 See supra, n. 49 & 50.

339 Exhibit 20, at 60:12-13. 

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about her father investing, “... I would recommend he come to Par. I have 80 million in the 

company myself. So his money would be side by side w [sic] mine.”340 

LaForte’s claims that he has invested money are false. Not only did LaForte not invest his 

own money to start Par Funding,341 but also he has in fact never invested in Par Funding.342 

9. Misrepresentations and Omissions about Vagnozzi’s Regulatory History 

While soliciting investors for the Par Funding investment through ABFP, Vagnozzi touts 

his financial and business acumen and his success through ABFP, but fails to disclose his 

regulatory history. For example, at the November 2019 solicitation dinner, Vagnozzi touted his 

“proven track record,” how investors have never missed a payment, and how well ABPF does for 

its investors.343 At this same dinner, Vagnozzi told the 300 investors and potential investors: 

“What I’m doing is legal, but most financial advisors don’t have a set of you-know-what’s to drop 

that license so they can do what I’m doing.”344

In truth, just months before making this representation to potential investors, the 

Pennsylvania Securities Regulators sanctioned Vagnozzi for violating state securities laws.345

Vagnozzi has testified under oath that ABFP is his alter ego.346 However, while playing up 

his supposed investment success with ABFP, including success through the Par Funding 

investment, Vagnozzi fails to disclose to investors the fact that he settled a regulatory action with 

the state of Pennsylvania in May 2019 ordering him to pay a $490,000 fine based on his sales of 

the Par Funding investment in violation of state law.347

Understanding that investors would want to know of unlawful activity when deciding with 

whom to invest, Vagnozzi publishes an article on the ABFP website addressing the issue head-on. 

                                                            

340 Exhibit 18, DePietro Declaration at ¶¶ 3 & 18and Exh. C thereto (pdf pages 22-23 of 25). 

341 Exhibit 17, LaForte Deposition, at 36:24—37:2. 

342 Exhibit 3, Deposition of Par Funding Corporate Designee Cole, at 166:22-167:13-67; 313:8-

316:13 (testifying that the representations appearing in the October 19, 2018 email are false). 

343 Exhibit 20, at 18:6-10. 

344 Id. as 23:17-20. 345 Exhibit 57. 346 Exhibit 40, 2018 Vagnozzi Deposition, at 56:7-24. 

347 Exhibit 20, November 2019 Transcript; Exhibit 57; 

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And lying about it. Specifically, on the ABFP website, Vagnozzi has an article published entitled 

“What’s the Catch? By Dean Vagnozzi.” In it, he tells potential investors: 

I know that potential clients will inevitably wonder, “what’s the catch?” Is Dean 

Vagnozzi a scam artist? Is A Better Financial Plan 1346 a fraud? Of course they 

would be skeptical! And so would I! So let me save you a lot of time. There is no 

catch. 

So stop looking for one. Stop googling, stop searching to see if Dean Vagnozzi is 

a scam, stop looking on the Better Business Bureau’s website to see if A Better 

Financial Plan 1346 is a fraud. I have never had a criminal record in my life and I 

am very confident that there never will be. 

In fact, to the best of my knowledge, the only law that I think I ever broke was a 

speeding ticket that I received on the New Jersey Turnpike back when I was in my 

early 20’s. That is about the only misdemeanor that I have ever been a part of. (Jeez, 

I sound like a lot of fun, don’t I?)348

Vagnozzi concludes his article by further assuring potential investors, “I can assure you 

that my record is squeaky clean.”349 

In truth, not only was Vagnozzi sanctioned by the Pennsylvania Securities Regulators for 

violating the state securities laws in 2019; but also in February 2020 the Texas Securities 

Regulators entered an Emergency Cease and Desist Order against Vagnozzi’s alter ego ABFP for, 

engaging in fraudulent conduct in connection with the Par Funding offering.350 

Even after the Commission filed a Consent Order against Vagnozzi for his violations of 

the federal securities laws on July 14, 2020, Vagnozzi continues to publish the “What’s the Catch?” 

article, “What’s the Catch?” on the ABFP website.351 Further, as recently as July 23, 2020, the 

ABFP website homepage includes a photo of Vagnozzi standing with individuals with the caption 

“A Team You Can Trust.”352 This caption includes a hyperlink that takes the reader to a page that 

reads “About Dean Vagnozzi,” which details Vagnozzi’s successes and career path.353

                                                            

348 Exhibit 46, at pdf pp 17 of 26 (emphasis added). 

349 Id. at p. 20 of 26. 

350 Exhibit 37. 351 Id., Declaration of July 22, 2020 web capture; Exhibit 160. 

352 Exhibit 46 at pdf pp. 2-3 of 26. 

353 Id. at pdf. pp. 4-11 of 26. 

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Notably missing is any mention of Vagnozzi’s regulatory history and the Orders entered 

against him for violating Pennsylvania and Texas state securities laws in connection with the offer 

and sale of Par Funding securities, and violating federal securities laws in connection with the 

offer and sale of four other securities offerings. 

10. Misrepresentations and Omissions about ABFPs Regulatory History 

ABFP’s website homepage, www.abetterfinancialplan.com, features a representations that 

ABFP delivers 10-14% annual returns or better using investments “put together with one of 

Philadelphia’s largest law firms.”354 The website also re-publishes purported testimonials from 

investors touting ABFP, and Vagnozzi reassures investors that ABFP is not a fraud, that the 

investment with ABFP is safe, and that even his own parents have invested through ABFP.355 The 

website goes on to tell investors: 

With the help of Dean Vagnozzi’sattorney, John Pauciulo, and one of the largest 

law firms in the Philadelphia region, clients at ABFP are able to “invest like the big 

boys” by pooling their money together and creating Private Placement 

Memorandums, which then allows clients to invest in opportunities that they 

otherwise may not have access to. Each asset class comes with the Vagnozzi 

enforcement that the investment must be safe, liquid, and less volatile than anything 

put together by Wall Street.356 

While touting the safety and success of ABFP, and that its investments are put together 

with “one of Philadelphia’s largest law firms,’ ABFP fails to disclose that the Texas Securities 

Regulators entered an Emergency Cease-and-Desist against ABFP in February 2020. These 

representations on the website remain posted even after the Commission’s July 14, 2020 Ceaseand-Desist Order. 

Additionally, in the Exchange Offering materials provided to investors in April 2020, 

ABFP disclosed as an investment risk the existence of lawsuits filed by small businesses based on 

Loan disputes.357 However, there is no disclosure of the existence of the case against ABFP, Par 

                                                            

354 Id. at pdf. P. 12 & 24-25 of 26. 

355 Id. at pdf. pp. 18-19 of 26. 

356 Id. at pdf p. 24 of 26. 

357 Exhibit 109 at ¶¶ 20-21 and Exh. H thereto at pdf pp. 40 of 67 (last full paragraph). 

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Funding, and Abbonizio in Texas. Nor is there is any disclosure of the Emergency Cease-andDesist Order the Texas Regulators entered months before the Exchange Offering based on findings 

that ABFP, Par Funding, and Abbonizio made fraudulent and material misrepresentations and 

omissions to investors in connection with the Par Funding and Agent Fund offering, or that the 

fact that the action filed by the Texas Regulators was – and is – ongoing. 

11. Misrepresentations and Omissions about Abbonizio’s Regulatory History 

Similarly, when ABFP and Par Funding offered the Exchange Offering in April 2020, the 

Texas Securities Regulators had issued the Emergency Cease-and-Desist Order against Par 

Funding and Abbonizio.358 ABFP and Vagnozzi were aware of that Order, as ABFP is also a party 

to the Texas Action.359 When offering the Exchange Notes, ABFP and Vagnozzi reassured 

investors about Par Funding’s ability to rebound and recommence payments if investors accepted 

the Exchange Notes and touted the hardworking employees at Par Funding.360 Par Funding’s 

website continued advertising its purported “strong, dedicated team,” which continues to this 

day.361 At the time of Exchange Note offering, Abbonizio was a partial owner and manager of Par 

Funding who had solicited investors to make their initial investments in Par Funding through the 

Agent Funds, and Abbonizio continues his role at Par Funding today. 

However, at no time did ABFP, Vagnozzi, or anyone at Par Funding disclose to investors 

that just months before the offering began, the Texas Securities Regulators issued an Emergency 

Cease-and-Desist Order against Abbonizio and Par Funding for, among other things, engaging in 

fraud in connection with the Par Funding offerings and Agent Fund solicitations.362 

Instead, the Defendants chose to conceal the negative information from investors. 

 

                                                            

358 Exhibit 37. 359 Id. 

360 Exhibit 109 at Exh. D thereto (pdf pp. 4-5). 

361 Exhibit 43 at pdf pp. 18-19. 

362 See, e.g., Exhibit 25, at ¶ 42. 

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VI. MEMORANDUM OF LAW 

A. Standard for Obtaining a Temporary Restraining Order 

Section 20(b) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. § 77t, and Section 

21(d) of the Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. § 78u(d), provide that 

in Commission actions the Court shall grant injunctive relief upon a proper showing.363 This 

“proper showing” has been described as “a justifiable basis for believing, derived from reasonable 

inquiry or other credible information, that such a state of facts probably existed as reasonably 

would lead the SEC to believe that the defendants were engaged in violations of the statutes 

involved.”364 

The Commission is entitled to a temporary restraining order if it establishes (1) a prima 

facie case showing the Defendants have violated the securities laws, and (2) a reasonable 

likelihood they will repeat the wrong.365 

The Commission appears “not as an ordinary litigant, but as a statutory guardian charged 

with safeguarding the public interest in enforcing the securities laws.”366 The Commission 

therefore faces a lower burden than a private litigant when seeking an injunction, and need not 

meet the requirements for an injunction imposed by traditional equity jurisprudence.367 Unlike 

private litigants, the Commission need not demonstrate irreparable harm or the unavailability of 

an adequate remedy at law.368 Nor is it required to show a balance of equities in its favor.369 

                                                            

363 SEC v. Unifund SAL, 910 F.2d 1028, 1035 (2nd Cir. 1990); SEC v. Lybrand, No. 00 Civ.1387, 

2000 WL 913894 *1, *9 (S.D.N.Y. July 6, 2000); SEC v. Unique Fin. Concepts, Inc., 119 F. Supp. 

2d 1332, 1338 (S.D. Fla. 1998), aff’d, 196 F.3d 1195 (11th Cir. 1999). 

364 SEC v. Gen. Refractories Co., 400 F. Supp. 1248, 1254 (D.D.C. 1975). 

365 Unique Financial, 119 F. Supp. 2d at 1338; SEC v. Management Dynamics, Inc., 515 F.2d 801, 

807 (2nd Cir. 1975). 

366 Management Dynamics, 515 F.2d at 808. 

367 Hecht Co. v. Bowles, 321 U.S. 321, 331 (1944); accord SEC v. International Loan Network, 

Inc., 770 F. Supp. 678, 688 (D.D.C. 1991), aff’d, 968 F.2d 1304 (D.C. Cir. 1992). 

368 Unique Financial, 119 F. Supp. 2d at 1338; Lybrand, 2000 WL 913894 at *9. 

369 Unifund SAL, 910 F.2d at 1036; SEC v. Musella, 578 F. Supp. 425, 434 (S.D.N.Y. 1984). 

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The Commission’s evidence in this case warrants entry of the requested injunctive relief 

on all applicable grounds. The declarations, account records, and other exhibits attached to this 

motion demonstrate Hilton, Pacific, Rock Castle I, and Rock Castle II are violating the anti-fraud 

and registration provisions of the federal securities laws, and will continue to violate them if the 

Court does not immediately restrain and enjoin them. 

B. The Commission Has Established Prima Facie Violations Of The Securities Laws

The Commission has met its burden of establishing a prima facie showing of violations of 

the securities laws as alleged in the Complaint.

1. The Offered Investments are Securities 

a. The Par Funding, ABFP Funds, Fidelis Financial Fund, 

and RE Fund Promissory Notes Are Securities 

The promissory notes are securities. The Defendants self-identify the notes as securities 

in their S.E.C. filings. Further, promissory notes are presumed to be securities. Even if the Court 

found that these particular notes are not securities, they are still securities because they are 

investment contracts. 

i. Defendants Self-Identified The Notes as Securities 

Par Funding, ABFP Income Fund, ABFP Income Fund 2, Fidelis Financial Planning, and 

RE Fund 2 each filed a Form D with the Commission self-identifying that they are offering debt 

securities (i.e., promissory notes).

ii. The Notes Are Also Securities 

Under Reves and the Family Resemblance Test 

According to the Supreme Court in Reves v. Ernst & Young, Congress’ purpose a “note” is 

presumed to be a security.370 There are narrow categories that are plainly not securities (such as 

consumer financing notes, mortgage notes, and short-term commercial paper), or bears a strong 

“family resemblance” to those non-security instruments. Id. at 65-66; SEC v. R.G. Reynolds 

                                                            

370 Section 2(a)(1) of the Securities Act and Section 3(a)(10) of the Exchange Act define “security” 

to include “any note.” Securities Act §2(a)(1); Exchange Act §3(a)(10). 

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Enterprises, Inc., 952 F.2d 1125 (9th Cir. 1991). Reves established a four-factor family 

resemblance test to determine whether a note bears a family resemblance to one of the identified 

instruments: (1) the motivations of the buyer and seller; (2) the plan of distribution; (3) the 

reasonable expectations of the investing public; and (4) the existence of a risk-reducing factor such 

as an alternate regulatory regime. See id. at 66-67. 

The first Reves factor examines the transaction “to assess the motivations that would 

prompt a reasonable seller and buyer to enter into it.” Reves, 494 U.S. at 56. The inquiry is 

whether the motivations are investment (suggesting a security) or commercial or consumer 

(suggesting a non-security). Pollack v. Laidlaw Holdings, Inc., 27 F.3d 808, 812 (2d Cir. 1994) 

(holding that mortgage participations were securities under Reves): Wallenbrock, 313 F.3d at 538 

(“buyers seeking to make a significant profit provided Wallenbrock with cash for its business of 

buying accounts receivable). Here investors were clearly motivated to make an investment, the 

notes were marketed as investments. 

The second factor is whether there is “common trading for speculation or investment” 

which is satisfied when the notes are “offered and sold to a broad segment of the public.” Reves, 

494 U.S. at 68. As set forth above, Par Funding claims to have 488 investors who have purchased 

a Par Funding Note and 1,200 who have invested in Par Funding through an Agent Fund. Such a 

widespread distribution to an extremely large number of holders is more typical of a securities 

offering than of a borrower/lender relationship. Wright, 972 F.2d 350, at *3 (notes sold to 200 

investors constituted broad segment). 

The next factor the court will analyze is the “reasonable expectations of the investing 

public” and whether there is a valuable return on an investment, as well as the length and 

characteristics of the note. See, e.g., Stoiber v. SEC, 161 F.3d 745, at 751 (D.C. Cir. 1998) 

(“Whether notes are reasonably perceived as securities generally turns on whether they are 

reasonably viewed by purchasers as investments.”) The Defendants offered investors high returns 

in exchange for using investor money to make loans to small businesses. A reasonable investor 

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would believe that Notes were investments, particularly since the PPMs and marketing materials 

identify them as such. 

The final factor is whether there are any risk-reducing factors, such as an alternative 

regulatory scheme. Reves, 494 U.S. at 69. Here, there simply is not an alternative regulatory 

regime or other risk-reducing factors. Accordingly, the notes are securities under Reves and thus 

subject to federal securities regulation. 

iii. The Notes Also Are Investment Contracts 

The notes also qualify as investment contracts, and thus are securities for an additional 

reason. Section 2(a)(1) of the Securities Act and Section 3(a)(10) of the Exchange Act define 

“security” to include, among other things, “investment contracts.” In SEC v. W.J. Howey Co., 328 

U.S. 293, 298-99 (1946), the Supreme Court defined an investment contract as (1) an investment 

of money, (2) in a common enterprise, (3) with the expectation of profits produced solely by the 

efforts of others. SEC v. Unique Fin. Concepts, Inc., 196 F.3d 1195, 1199 (11th Cir. 1999). The 

notes clearly involve an “investment of money.” The common enterprise element can be 

established by broad vertical commonality, which requires only a showing that the investors are 

dependent for their returns upon the expertise or efforts of the investment promoter.371 SEC v. ETS 

Payphone, Inc., 300 F.3d 1281, 1284 (11th Cir. 2004), re-aff’d by SEC v. ETS Payphones, Inc. 408 

F.3d 727, 732 (11th Cir. 2005). Here, investors were entirely dependent on Par Funding’s efforts 

for their returns. Similarly, the third element – an expectation of profits based on the efforts of 

others – is satisfied here. The investors made passive investments and had no role in selecting or 

analyzing the underlying small businesses seeking cash advances.372 The expected profitability of 

the investments, as well as the promise to pay returns, were derived solely from Par Funding’s 

efforts in its Loan business. Once investors executed the notes, they had no control over how their 

                                                            

371 The Commission does not require vertical or horizontal commonality per se, nor does it view a 

“common enterprise” as a distinct element of the term “investment contract.” In re Barkate, 57 

S.E.C. 488, 496 n.13 (Apr. 8, 2004) (Commission Opinion). 

372 Exhibits 55, 59, 61, 113, 162, 165; Exhibit 25, at ¶ 48; Exhibit 62, at ¶ 18; Exhibit 96, at ¶ 7;

Exhibit 101, at ¶ 25; Exhibit 103, at ¶ 17; Exhibit 104, at ¶ 22; Exhibit 109, at ¶ 27 . 

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money would be used. As such, the notes are investment contracts within the meaning of Section 

2(a)(1) of the Securities Act and Section 3(a)(10) of the Exchange Act. 

b. The Limited Partnership Interests ABFP Offered Are Also Securities 

In addition to offering promissory notes, ABFP offered limited partnership interests. The 

ABFP Funds self-identified their offerings as debt or equity securities in their Forms D filed with 

the Commission. The ABFP limited partnership interests are also investment contracts under 

Howey for the reasons discussed above with respect to the notes. 

2. All Defendants Are Violating Sections 5(a) and (c) of the Securities Act 

Section 5(a) of the Securities Act prohibits the direct or indirect sale of securities through 

the mail or interstate commerce unless a registration statement has been filed and is in effect. 

Similarly, Section 5(c) prohibits the offer to sell securities through the mail or interstate commerce 

unless a registration statement has been filed. To establish a prima facie case under these 

provisions, the Commission must prove that: (a) no registration statement was in effect or had been 

filed as to the offering; (b) the defendants, directly or indirectly, sold or offered to sell the 

securities; and (c) the offer or sale was made through use of the interstate facilities or the mails.373 

Once the Commission establishes a prima facie case for a violation, it is the Defendants’ burden 

to prove that the securities offering qualified for a registration exemption.374 Scienter is not 

required to establish a violation of Section 5.375 Defendants are liable under Section 5 if they were 

a necessary participant or substantial factor in the illicit sale.376 

In this case, the Commission can establish a prima facie case against all of the Defendants 

for violations of 5(a) and 5(c) of the Securities Act. The Defendants are offering securities in the 

form of notes and partnership interests through interstate commerce, including the Internet, email, 

                                                            

373 Raiford v. Buslease, Inc., 825 F.2d 351, 353-54 (11th Cir. 1987); SEC v. Continental Tobacco 

Co., 463 F.2d 137, 155 (5th Cir. 1972); SEC v. Chemical Trust, No. 00-8015-CIV-Ryskamp, 2000 

WL 33231600 at *9 (S.D. Fla. Dec. 19, 2000); Unique Financial, 119 F.Supp.2d at 1339. 

374 See SEC v. Ralston Purina Co., 346 U.S. 199, 126 (1953). 

375 See SEC v. Calvo, 378 F.3d 1211; 1215 (11th Cir. 2004) (“Scienter is not a consideration.”). 

376 See id. at 1215 (“To demonstrate that a defendant sold securities, the SEC must prove that the 

defendant was a “necessary participant” or “substantial factor” in the illicit sale.”). 

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and telephone. As set forth above, Par Funding used finders to solicit investors nationwide and 

later used the Agent Firms to continue the solicitation through investment fund offerings, including 

Fidelis, the ABFP Funds, and the RE Funds. ABFP, the ABFP Fund, Vagnozzi, United Fidelis, 

Furman, Fidelis, Retirement Revolution, the RE Funds, and Gissas were necessary participants 

and substantial factors in the Par Funding offering in that they drew numerous prospective 

investors in to invest in Fidelis Financial and the RE Funds’ for the ultimate purpose of raising 

money for Par Funding. LaForte, Cole, Abbonizio, and Vagnozzi participated in seminar 

presentations soliciting investors and prospective investors for Par Funding and ABFP, and 

Abbonizio met with individual investors during in-person meetings to solicit them to invest. 

ABFP Management was also a necessary participant and substantial factor in the Par Funding 

and ABFP Funds’ offerings in that it controlled and managed the logistics of the money flow from 

many of the Agent Funds to Par Funding. ABFP Management facilitated the creation of the PPMs 

through ABFP’s attorney. Full Spectrum, which has operated Par Funding since 2017, was a 

necessary participant and substantial factor in the Par Funding and Agent Funds’ offerings in that 

it sent the Par Funding promissory notes to the Agent Funds for execution and coordinated the 

issuance of the promissory notes. LaForte, McElhone, Cole and Abbonizio exercised control over 

Par Funding’s business, including raising capital from investors, and over Full Spectrum’s 

business. 

No registration statement was in effect or had been filed with the Commission in 

connection with any of the promissory notes or limited partnership interests.377 Thus, the 

Commission has established a prima face case of Section 5 violations. 

While the Commission need not demonstrate that no registration exemption applies and it 

is the Defendant’s burden to prove one does, it bears noting that clearly no registration exemption 

exists here. Par Funding, the ABFP Funds, and the RE Funds filed a Form D with the Commission 

claiming an exemption from registration under Rule 506(b) of Regulation D [17 C.F.R. § 

                                                            

377 Exhibits 50-52, 54, 56, 58, 64, 75, 145 (Filings showing the Funds did not register the offerings 

but instead claimed they were exempt from doing so). 

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230.506(b)].378 However, this exemption does not apply where there is a general solicitation, 

including but not limited to the use of “[a]ny advertisement, article, notice or other communication 

published in any newspaper, magazine, or similar media or broadcast over television or radio;” or 

“[a]ny seminar or meeting whose attendees have been invited by any general solicitation or general 

advertising. 17 C.F.R. § 230.502(c). As set forth above, Par Funding used so-called finders to help 

solicit investors nationwide. The Defendants advertised the investments in newspapers, on 

television and radio, through email messages, and on the Internet. They held seminars and dinners 

for potential investors. In sum, they engaged in precisely the activity that precludes the application 

of a registration exemption. 

3. Par Funding, Full Spectrum, ABFP, ABFP Management, McElhone, Cole, LaForte, 

Abbonizio, Vagnozzi, United Fidelis and Furman Are Violating 

Securities Act Section And Exchange Act Section 10(b) And Rule 10b-5(b) 

Par Funding, Full Spectrum, ABFP, ABFP Management, McElhone, Cole, LaForte, 

Abbonizio, and Vagnozzi, United Fidelis and Furman are violating Section 17(a) of the Securities 

Act and Section 10(b) and Rule 10b-5 of the Exchange Act. 

Section 17(a) of the Securities Act, which proscribes fraudulent conduct in the offer or sale 

of securities, and Section 10(b) of the Exchange Act and Exchange Act Rule 10b-5, which 

proscribe fraudulent conduct in connection with the purchase or sale of securities, prohibit 

essentially the same type of conduct.379 

Section 10(b) of the Exchange Act and Rule 10b-5 render it unlawful, in connection with 

the purchase or sale or securities, to: (a) employ any device, scheme, or artifice to defraud; (b) 

make any untrue statement or omission of material fact; or (c) engage in any act, practice, or course 

of business which operates or would operate as a fraud or deceit on any person, in connection with 

the purchase or sale of any security.380 The Commission must also establish scienter and that the 

                                                            

378 Id.

379 See SEC v. Monterosso, 756 F.3d 1326, 1333-34 (11th Cir. 2014). 

380 15 U.S.C. § 78j(b); 17 C.F.R. § 240.10b-5. 

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violations were made while using any means or instrumentality of interstate commerce.381 For the 

Commission’s case, reliance, damages, and loss causation are not required elements.382 

Section 17(a) of the Securities Act makes it unlawful to engage in certain conduct “directly 

or indirectly” in “the offer or sale of securities.”383 Specifically, Section 17(a)(1) prohibits 

“employ[ing] any device, scheme, or artifice to defraud; Section 17(a)(2) prohibits “obtain[ing] 

money or property by means of any untrue statement of a material fact or any [material] omission;” 

and Section 17(a)(3) prohibits “engag[ing] in any transaction, practice, or course of business which 

operates or would operate as a fraud or deceit upon the purchaser.”384. A showing of scienter is 

required under Section 17(a)(1), but Sections 17(a)(2) and (a)(3) only require a showing of 

negligence.385 

The antifraud provisions also reach beyond misrepresentations or omissions and 

encompass any wrongdoing by any person that rises to the level of a deceptive practice.386 A 

defendant engages in a fraudulent scheme in violation of the antifraud provisions of the securities 

laws and violates Section 17(a)(1) and (3) and Rule 10b-5(a) and (c) when he commits any 

manipulative or deceptive act or acts that are part of a fraudulent or deceptive course of conduct, 

or are in furtherance of a scheme to defraud.387 To state a claim based on conduct violating these 

provisions, the Commission must establish: (1) the defendant committed a deceptive or 

manipulative act; (2) in furtherance of the alleged scheme to defraud; (3) with scienter.388 

                                                            

381 SEC v. Corporate Relations Group, No. 6:99-cv-1222, 2003 WL 25570113 at *7 (M.D. Fla. 

March 28, 2003). 

382 SEC v. Morgan Keegan & Co., 678 F.3d 1233, 1244 (11th Cir. 2012). 

383 15 U.S.C. § 77q(a). 

384 15 U.S.C. § 77q(a)(1)-(3). 

385 Aaron v. SEC, 446 U.S. 680, 697 (1980). 

386 Superintendent of Insurance v. Bankers Life and Casualty Co., 404 U.S. 6, 10 (1971); see also 

In the Matter of Cady, Roberts & Co., 40 S.E.C. 907, 913 (1961) (the Commission has held that 

the subdivisions of Rule 10b-5, as well as Securities Act §17(a), should be considered “mutually 

supporting”). 

387 SEC v. Huff, 758 F. Supp. 2d 1288, 1347-48 (S.D. Fla. 2010). 

388 In re Alstom SA Securities Litigation, 406 F. Supp. 2d 433, 474 (S.D.N.Y. 2005) (citing In re 

Global Crossing, 322 F. Supp. 2d 319, 336 (S.D.N.Y. 2004)). 

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a. The Defendants Are Making Material Misrepresentations and Omissions 

As discussed above, the Defendants are making numerous material misrepresentations and 

omissions to investors. 

Par Funding, McElhone, LaForte, Abbonizio, and Cole touted LaForte’s management 

expertise and/or the success of Par Funding, but omitted LaForte’s criminal history and Par 

Funding’s regulatory history, which rendered those affirmative statements false and misleading. 

Relatedly, LaForte authors articles touting his business acumen that are ported on Par Funding’s 

website, but fails to disclose that he is a convicted felon. McElhone, LaForte, Cole, Abbonizio, 

Vagnozzi, Gissas, and Furman touted the success of Par Funding to potential investors, but omitted 

Par Funding’s regulatory history. Furman made misrepresentations that the New Jersey Securities 

Regulators had “retracted” the Cease-and-Desist Order issued against Par Funding. Similarly, 

Vagnozzi also touted his own success without disclosing his regulatory history. The omissions 

about LaForte’s criminal background, and Par Funding’s and Vagnozzi’s regulatory histories made 

the positive statements misleading.389 

Abbonizio and LaForte touted the Loan default rate, underwriting process, onsite merchant 

inspections, and insurance while knowing, or being severely reckless in not knowing, that the 

actual default rate was much higher than claimed and that Par Funding did not, in fact, conduct the 

rigorous underwriting process or onsite inspections it claimed it did prior to lending small 

businesses money through the Loans. Par Funding made these same representations in its 

brochure, which it distributed to investors at solicitation events and meetings from at least August 

2019 until July 2020, and which it provided to Vagnozzi and other Agent Fund managers for 

distribution to investors beginning in no later than March 2018. McElhone, as Par Funding’s CEO, 

and LaForte, as a control person, had control over Par Funding’s website, marketing materials and 

                                                            

389 See, U.S. v. Bachynsky, 415 F. App’x 167, 172 (11th Cir. 2011) (criminal defendant who “held 

himself out as both a legitimate businessman and a licensed and qualified medical expert” to solicit 

new investors in a medical company had a duty to disclose to them “that he had prior convictions 

and had lost his medical license”). 

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Form D filings, and is responsible for the misrepresentations in those materials, which include that 

Par Funding offers small businesses insurance on the Loans, conducts on-site inspections prior to 

approving Loans, has a 1% default rate, and conducts a rigorous underwriting process prior to 

approving Loans. 

As set forth above, McElhone and LaForte as Par Funding’s control persons and Cole, as 

the 2020 filing he signed, falsely represented in the Par Funding Form D filings that Par Funding 

was not paying money to Par Funding principals and that Par Funding was not paying sales 

compensation.390 As Cole recently testified in private litigation, he is the CFO of Par Funding 

through his role as CFO of Full Spectrum, which operates Par Funding. When he made these 

representations, he was acting in his capacity as CFO of Full Spectrum and of Par Funding, which 

itself has no employees other than McElhone. Cole, as Par Funding’s CFO, knew or was reckless 

in not knowing that contrary to the statement in the Form D, Par Funding had paid significant 

amounts to McElhone and Cole, through his companies. Specifically, McElhone received at least 

$11.3 million from the offering between July 2015 and February 2020, which included investor 

funds.391 From July 2019 until October 2019, Cole has received at least $ 1,759,136.42 from Par 

Funding through payments, which included investor funds, to his company ALB Management 

Inc.392 An additional amount of about $14.4 million was transferred from Par Funding to Beta 

Abigail and New Field Ventures, LLC, companies in which Cole has an ownership or other 

beneficial interest, between July 2016 and November 2019.393

All of these actions violated Section 17(a)(2) of the Securities Act in that they “obtain[ed] 

money or property by means of any untrue statement of a material fact or any [material] omission.” 

                                                            

390 See Janus Capital Group, Inc. v. First Derivative Traders, 564 U.S. 135, 142 (2011) (holding 

that “[f]or purposes of Rule 10b-5, the maker of a statement is the person or entity with ultimate 

authority over the statement, including its content and whether and how to communicate it”) 

391 Exhibit 13 at ¶ 12. 

392 Exhibit 13 at ¶ 13; Exhibit 132, Transcript of UC Undercover Meeting, at 123:4-15. 

393 Exhibit 13 at ¶¶ 14-15; Exhibit 131, Par Funding Audited Financial Statements, at pdf page 

20 (“Beta Abigail and New Field Ventures, LLC, Inc. are owned in part by the Company’s Chief 

Financial Officer and Director of Investor Relations.”). 

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15 U.S.C. § 77q(a)(2). The misrepresentations and omissions enabled the Defendants to 

fraudulently persuade investors to invest in the promissory notes and limited partnership interests. 

Furthermore, the misstatements and omissions set forth above violated Section 10(b) and Rule 

10b-5(b) of the Exchange Act in that they constituted untrue statements or omissions of material 

fact or material omissions. Par Funding, Full Spectrum, ABFP, ABFP Management, United 

Fidelis, Retirement Evolution, McElhone, LaForte, Cole, Abbonizio, Vagnozzi, Furman and 

Gissas all obtained money through their misrepresentations.394 

b. The Misrepresentations and Omissions are Material 

A false statement or omission must be material for a defendant to be liable for it. The test 

for materiality is “whether a reasonable man would attach importance to the fact misrepresented 

or omitted in determining his course of action.”395 Put another way, information is material if a 

reasonable investor would consider it significant to making an investment decision.396 

“[I]f a [speaker] chooses to make a statement on a subject, having chosen to speak, the 

company is obligated to make a full and fair disclosure.”397 Truthful statements can be misleading 

when someone omits to state a material fact without which the truthful statement, based on the 

circumstances, becomes misleading.398 “The test for materiality of an omission is ‘whether a 

reasonable man would attach importance to the fact omitted in determining a course of action.’”399 

A false statement or omission need not be outcome determinative for it to be considered material; 

rather it simply must be significant to the investor’s decision.400 

                                                            

394 See Supra, n.368 (filings listing amount raised from investors); Exhibit 13. 395 SEC v. Merchant Capital, LLC, 483 F.3d 747, 766 (11th Cir. 2007) (citation omitted). 

396 Basic v. Levinson, 485 U.S. 224, 230 (1988). 

397 Harvey M. Jasper Retirement Trust v. Ivax Corp., 920 F. Supp. 1260, 1267 (S.D. Fla. 1995) 

(citing Dominick v. Dixie Natl Life Ins. Co., 809 F. 2d 1559, 1571 (11th Cir. 1987) ([O]nce 

[defendant] undertook to speak, it was required to make a full and fair disclosure.”)). 

398 17 C.F.R. § 240.10b-5 (in the context of Rule 10b-5); Harvey M. Jasper Retirement Trust, 920 

F. Supp. at 967. 

399 Merchant Capital, 483 F.3d at 768 (quoting Kennedy v. Tallant, 710 F.2d 711, 719 (11th Cir. 

1983)). 

400 SEC v. City of Miami, 988 F. Supp. 2d 1343, 1357 (S.D. Fla. 2013) (“to be material, a fact need 

not be outcome-determinative, that is, it need not be important enough that it would necessarily 

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Under these standards, the Defendants’ false statements and omissions are clearly material. 

Investors would certainly want to know about LaForte’s criminal background. This information 

is unquestionably material because it reflects on the character and integrity of a person integral to 

the success or failure of the enterprise. United States v. Hatfield, 724 F.Supp. 2d 321, 328 

(E.D.N.Y. 2010) (“It is well-settled that information impugning management’s integrity is material 

to shareholders.”). A reasonable investor would have wanted to know LaForte was running the 

day-to-day operations and controlling Par Funding, and that he was a convicted felon. And indeed, 

Par Funding investors did care and would not have invested had they known the truth.401

 The failure to disclose the prior state regulatory actions against Par Funding, Vagnozzi, 

ABFP, and Abbonizio is a material omission.402 A reasonable investor would have wanted to 

know that three states had issued Orders against Par Funding for securities law violations, and that 

Vagnozzi was sanctioned for securities law violations in connection with the Par Funding offering. 

And the Par Funding investors do care and would not have invested had they known.403 

The Defendants’ misrepresentations about the Loan default rate, the Loans being insured, 

and the rigorous underwriting process, including the onsite inspections of the small businesses, are 

material. As Abbonizio himself has explained, the underwriting process is the key to ensuring the 

Loans are made to small businesses who will pay back the Loans, and the 1% default rate is 

important for investors to consider because if the small businesses default on the Loans, Par 

Funding will not be able to pay investment returns.404 

                                                            

cause a reasonable investor to change his investment decision”) (quoting SEC v. Meltzer, 440 F. 

Supp. 2d 179, 190 (E.D.N.Y. 2006)). 

401 Exhibit 25, at ¶ 55; Exhibit 62, at ¶ 21; Exhibit 101, at ¶ 27; Exhibit 103, at ¶ 19; Exhibit 

104, at ¶ 25; Exhibit 109, at ¶ 32; Exhibit 96, at ¶ 10. 

402 See Merchant Capital at 771 (finding clear error where district court failed to find omission 

material because “[t]he existence of a state cease and desist order against identical instruments is 

clearly relevant to a reasonable investor, who is naturally interested in whether management is 

following the law in marketing the securities”). 

403 See Exhibit 25, at ¶¶ 42-43; Exhibit 62, at ¶ 15; Exhibit 101, at ¶ 22; Exhibit 103, at ¶ 12; 

Exhibit 104, at ¶ 18; Exhibit 109, at ¶ 24. 

404 Exhibit 20, November 21, 2019 Dinner, at 51:17-52:4; Exhibit 136 at 9:24-10:21. 

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Any reasonable investor would have wanted to know Par Funding was not conducting the 

underwriting process it claimed, doing the on-site inspections Par Funding touted as critical to its 

lending decision, and that the Loan default rate was about 10 times higher than what the 

Defendants claimed.405 Further, any reasonable investor would have wanted to know that contrary 

to the Defendants’ representations that small businesses rarely defaulted on the Loans, in truth Par 

Funding had filed more than 2,000 lawsuits seeking to collect on more than $300 million in missed 

payments on the $600 million it had loaned. 

 Additionally, telling investors no proceeds were going to Cole or McElhone when in fact 

they had together received more than $15 million is material. Misrepresentations regarding the 

use of investors' funds are material.406 Any reasonable investor would have wanted to know that 

Par Funding was making these payments to Cole and McElhone, and that the Form D filing with 

the Commission was not true.

c. The Defendants’ Scheme Liability 

All of the Defendants violated Sections 17(a)(1) and (3) of the Securities Act, and Section 

10(b) of the Exchange Act and Rules 10b-5(a) and (c), by participating in a scheme to defraud and 

engaging in a fraudulent course of conduct. As discussed above, to state a claim based on conduct 

violating these provisions, the Commission must establish: (1) the defendant committed a 

deceptive or manipulative act; (2) in furtherance of the alleged scheme to defraud; (3) with scienter 

(except as to Section 17(a)(3), which requires only a showing of negligence). Alstom, 406 F. Supp. 

2d at 474. 

A Defendant engages in a fraudulent scheme in violation of Section 17(a)(1) and (3) and 

Rule 10b-5(a) and (c) when he commits any manipulative or deceptive act or acts that are part of 

                                                            

405 See, e.g., Exhibit 25, at ¶¶ 45-46, 49, 50 & 53; Exhibit 62, at ¶¶ 17 & 18; Exhibit 101, at ¶ 

24; Exhibit 103, at ¶ 14-16; Exhibit 104, at ¶ 21; Exhibit 109, at ¶ 26. 406 SEC v. Cochran, 214 F.3d 1261, 1268 (10th Cir. 2000); SEC v. Research Automation Corp.,585 

F.2d 31, 35-36 (2nd Cir. 1978) (misleading statements and omissions about the use of investor 

funds were material as a matter of law). 

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a fraudulent or deceptive course of conduct, or are in furtherance of a scheme to defraud. The 

Defendant “must have engaged in conduct that had the principal purpose and effect of creating a 

false appearance of fact in furtherance of the scheme.”407 The language of Sections 17(a)(2) and 

(3), and Rule 10b(5)-a and c is “expansive” and these provisions “capture a wide range of conduct.” 

The Supreme Court has held that knowingly disseminating a false statement to investors 

with the intent to deceive can violate Rules 10b-5(a) and (c) and Section 17(a)(1), even if the 

defendant is not a “maker” of the statement for purposes of Rule 10b-5(b), as that term has been 

defined in Janus.

17 The Court rejected the defendant’s arguments that each subsection of Rule 

10b-5 “should be read as governing different, mutually exclusive, spheres of conduct” and that all 

conduct relating to false statements must be charged under Rule 10b-5(b) (or, by extension, Section 

17(a)(2)).408 Rather, the Court emphasized, there is “considerable overlap among the subsections 

of” Rule 10b-5 and Section 17(a), and thus the same underlying conduct may establish a violation 

of more than one subsection.409 The false statements and omissions described above alone provide 

a basis for scheme liability under Sections 17(a)(1) and (3), and Rules 10b-5(a) and (c).410 

However, in this instance, the Defendants have committed numerous deceptive and fraudulent acts 

beyond making misrepresentations and omissions, which can also give rise to scheme liability.411 

                                                            

407 Huff, 758 F. Supp. 2d at 1347-48. See also SEC v. Fraser, 2010 U.S. Dist. LEXIS 7038 at *23 

(D. Ariz. Jan. 28, 2010), quoting Cooper v. Pickett, 137 F.3d 616, 624 (9th Cir. 1997). 

408 Id. at 1102-03. 

409 Id. at 1102 (citing Herman & MacLean v. Huddleston, 459 U.S. 375, 383 (1983), for the 

proposition that “it is hardly a novel proposition that” different portions of the securities laws 

“prohibit some of the same conduct”). In Malouf v. SEC, the Tenth Circuit held that Lorenzo also 

governs interpretation of Section 17(a)(3). Malouf, 933 F.3d 1248, 1260 (10th Cir. 2019). 

410 Affiliated Ute Citizens of Utah v. U.S. 406 U.S. 128, 153 (1972) (liability under Rule 10b-5(a) 

and (c) established even though the case was one “involving primarily a failure to disclose” to 

investors); Stoneridge Inv. Partners, LLC v. Scientific-Atlanta, Inc., 552 U.S. 148, 158-59 (2008) 

(defendants’ “deceptive acts” and “course of conduct included both oral and written statements, 

such as the backdated contracts”). 

411 SEC v. U.S. Envtl., Inc., 155 F.3d 107, 111-12 (2nd Cir. 1998) (“a primary violator is one who 

participated in the fraudulent scheme”); SEC v. First Jersey Sec., Inc., 101 F.3d 1450, 1471-72 

(2nd Cir. 1996) (scheme liability extends to those “who had knowledge of the fraud and assisted 

in its perpetration”); SEC v. Lee, 720 F. Supp. 2d 305, 334 (S.D.N.Y. 2010). 

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Here, the Defendants all employed deceptive devices, including making materially false 

statements and omissions, in connection with, and in the offer and sale of the Notes, obtaining 

millions of dollars in proceeds from investors. First, as set forth in detail above, each of the 

Defendants made materially false or misleading statements to investors. Par Fuunding’s marketing 

materials also contained the false statements about the underwriting process and insurance. 

Additionally, McElhone, LaForte, Abbonizio, and Cole actively and intentionally concealed from 

investors both LaForte’s true involvement, identity, and control of Par Funding and his extensive 

criminal background. Finally, the Defendants coordinated an effort to raise investor funds through 

Agent Funds for more than two years to perpetuate the fraud. Par Funding could no longer rely 

on using finders, in light of the Pennsylvania Order and the New Jersey Order, yet continued to 

offer Par Funding Notes and the Agent Funds’ promissory notes in the same manner as had been 

done through the finders without disclosing the existence of the regulatory orders. Each of these 

proposed defendants participated in the development and/or continued use of the Agent Funds, 

allowing Par Funding to continue to fraudulently raise investor funds. 

All of these actions constitute manipulative or deceptive acts that are part of a fraudulent 

or deceptive course of conduct, or are in furtherance of a scheme to defraud in violation of Sections 

17(a)(1) and (3) of the Securities Act and Rules 10b-5(a) and (c). 

d. McElhone and LaForte Are Liable As Control Persons 

of Par Funding and Full Spectrum 

McElhone and LaForte are liable under Section 20(a) of the Exchange Act, which makes a 

person “who, directly or indirectly, controls any person liable under any provision of [the act] or 

of any rule or regulation thereunder ... liable jointly and severally with ... such controlled person.” 

15 U.S.C. § 78t(a). To plead a violation under Section 20(a), the Commission must allege “that 

(1) the defendant had the power to control the general affairs of the primary violator, and (2) the 

defendant had the power to control the specific corporate policy that resulted in the primary 

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violation.”412 “The plaintiff must also establish that the controlled person violated the securities 

laws.”413 A controlling person is liable if he “acted recklessly in failing to do what he could have 

done to prevent the violation.”414 

As set forth above in Section II, McElhone is the controlling officer and founder of Par 

Funding. She incorporated Par Funding and a signatory on each of Par Funding’s bank accounts. 

In fact, the Par Funding bank records reflect that she signs almost every check paid from the 

account. At least $11.3 million in investor funds were funneled to her, contrary to the statements 

Par Funding made in its Forms D filings that she did not receive any proceeds. 

In a June 30, 2020 deposition, CFO Cole testified that McElhone is the ultimate decision 

maker for Par Funding. At the very least, McElhone’s control of CBSG and its bank accounts is 

sufficient to show that she had the power to control the general affairs of CBSG and the policies 

of the company that resulted in CBSG’s violations of Section 10(b) of the Exchange Act and Rules 

10b-5 thereunder. Similarly, McElhone is Full Spectrum’s sole owner, and as such had the power 

to control the general affairs of Full Spectrum the policies of the company that resulted in CBSG’s 

violations of Section 10(b) of the Exchange Act and Rules 10b-5 thereunder. 

As set forth above, LaForte is also a control person of both Par Funding and Full Spectrum. 

LaForte founded Par Funding with McElhone and claims to be its owner. He runs the day-to-day 

operations at Full Spectrum, which operates Par Funding, he has hiring and firing authority at Par 

Funding and Full Spectrum, and he decides which Loans to approve and fund. His exercise of 

power to control the operations of Par Funding and Full Spectrum demonstrates that he had the 

power to control those companies’ general affairs and the policies that resulted in their violations 

of Section 10(b) of the Exchange Act and Rules 10b-5 thereunder. 

Thus, LaForte and McElhone are liable for Par Funding and Full Spectrum’s violations. 

 

                                                            

412 Laperriere v. Vesta Ins. Group, Inc., 526 F.3d 715, 723 (11th Cir. 2008); Brown v. Enstar 

Group, Inc., 84 F.3d 393, 396 (11th Cir. 1996). 

413 Brown, 84 F.3d at 396–97. 

414 Id.

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e. LaForte, McElhone, Cole, Abbonizio, Vagnozzi, And Furman 

Are Acting With The Requisite Scienter For Violations Of 

Securities Act Section 17(a)(1) and Exchange Act Section 10(b)(5) 

 Courts have defined scienter as a state of mind embracing intent to deceive, manipulate or 

defraud.415 Scienter can be established by a showing of knowing misconduct or severe 

recklessness.416 The Commission may establish scienter for violations of Sections 17(a) and 10(b) 

by showing defendants made representations to investors “without basis and in reckless disregard for 

their truth or falsity.”417 The scienter of a control person or individual acting as an officer of a 

company is imputed to the entity.418 

The evidence establishes that LaForte, McElhone, Cole, Abbonizio, Vagnozzi, and Furman 

have acted knowingly, or at a minimum recklessly, while making the misrepresentations and 

omissions discussed above. Abbonizio, and LaForte knew or were reckless in not knowing that 

statements made regarding the underwriting process, insurance offering to all small businesses, 

and onsite inspections were false. Abbonizio claims to own 25% of Par Funding and works in the 

Full Spectrum office from which it operates, and LaForte oversees the day-to-day operations of 

the underwriting department at Par Funding and decides which Loans to fund. Accordingly, they 

knew or were reckless in not knowing that statements that Par Funding conducted rigorous 

underwriting and conducted an on-site inspection of the small businesses were false. Similarly, 

as CEO with control over the Company, McElhone knew or was reckless in not knowing that these 

representations in the Par Funding brochure were false. For these same reasons, Abbonizio was 

reckless in not knowing that his verbal representations to potential investors that Par Funding 

insured the Loans was false and conducted rigorous underwriting and on-site inspections was false. 

As officers of the company, Abbonizio and McElhone’s scienter can be imputed to Par Funding, 

                                                            

415 Ernst & Ernst v. Hochfelder, 425 U.S. 185, 193 (1976). 

416 SEC v. Carriba Air Inc., 681 F.2d 1318, 1324 (11th Cir. 1982). 

417 SEC v. Kenton Capital, Ltd., 69 F. Supp. 2d 1, 10 (D.D.C. 1998). 

418 SEC v. Manor Nursing Centers, Inc., 458 F.2d 1082, 1096 n.16 (2d Cir. 1972); In re Sunbeam 

Sec. Litig., 89 F. Supp 2d 1326, 1340 (S.D Fla 1999) (officers’ scienter is properly imputed to 

corporation). 

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as can LaForte’s scienter as a de facto officer and an undisclosed control person of Par Funding. 

McElhone and LaForte’s scienter can also be imputed to Full Spectrum as control persons.419 

In Par Funding’s Forms D, Cole and McElhone reported that they would not receive any 

of the gross proceeds of the offering and that there were no finders’ fees. Cole, as CFO, and 

McElhone, as CEO and as a control person, knew or were reckless in not knowing that McElhone, 

her companies and Cole’s companies received millions of dollar from Par Funding and that Par 

Funding had paid so-called finders’ fees of at least $3.6 million plus an addition $1 million in 

payments labeled as “commissions” from July 2015 to February 2020. As officers of the company, 

McElhone and Cole’s scienter can be imputed to Par Funding and Full Spectrum.420 

Vagnozzi touts his personal success, the success of ABFP, and success of Par Funding 

when soliciting investors, while failing to disclose his own regulatory history and that of Par 

Funding. Vagnozzi has previously testified that ABFP is his corporate alter ego and people invest 

through ABFP because they are investing in Vagnozzi personally. Thus, Vagnozzi acted at least 

recklessly in not disclosing his own and Par Funding’s regulatory history. Vagnozzi’s scienter can 

be imputed to his ABFP, ABFP Management, and the ABFP Income Funds. 

Furman touts the success of Par Funding to potential investors and told at least one potential 

investor, who was unbeknownst to him an someone posing as an investor, that New Jersey 

securities regulators had not only retracted the New Jersey Order against Par Funding for securities 

law violations, but had told Par Funding “all of your books are good and we love it... you’re good,” 

and had cancelled the monetary sanctions against Par Funding. Furman had no reasonable basis 

for making this representation and knew or was reckless in not knowing his representation was 

false. The New Jersey Order remains published on the New Jersey Board of Securities’ website 

and remains in effect. Furman’s scienter can be imputed to United Fidelis and Fidelis Financial. 

                                                            

419 Id. 

420 Id.

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f. Negligence Is Easily Demonstrated As To All Defendants For Violations 

Of Securities Act Sections 17(a)(2) and (3) 

Because McElhone, LaForte, Cole, Abbonizio, Vagnozzi, and Furman acted with scienter, 

the lower standard of negligence required for violations of Sections 17(a)(2) and (3) is also met.421 

Gissas was, at a minimum, negligent in his failure to tell investors about the two state orders 

against Par Funding. Gissas touts the success of Par Funding to potential investors, but fails to 

disclose its regulatory history. He advertises the RE Funds investment as being invested in a 

leading company in the merchant cash advance industry and tells investors that Par Funding has a 

strong track record and is successful in the industry. He was raising money for Par Funding 

through Retirement Evolution when the New Jersey and Pennsylvania Orders were issued against 

Par Funding,422 and the Orders are publicly available on the Internet. Gissas knew or should have 

known about the existence of the two state orders, but omitted this information when touting the 

success of Par Funding to raise money into the RE Funds. Gissas’ negligence is imputed to 

Retirement Evolution, RE Fund and RE Fund 2.423

g. The “In Connection With” Requirement Is Easily Met 

 Because the Defendants are making misrepresentations and omissions in connection with the 

offer, purchase, and sale of the securities they are offering and selling to investors, their acts meet the 

“in connection with” requirement of Section 10(b) and Rule 10b-5.424 

                                                            

421 Scienter is only required for Exchange Act Section 10(b) and Securities Act Section 17(a)(1); 

violations of Sections 17(a)(2) and (3) of the Securities Act do not require a finding of scienter. 

Aaron v. SEC, 446 U.S. 680, 697 (1980). Violations of Sections 17(a)(2) and (3) is established by 

showing negligence. SEC v. Hughes Capital Corp., 124 F.3d 449, 453-54 (3rd Cir. 1997). 

422 See, e.g., Exhibits 115, 117 & 142. 

423 In re Sunbeam Sec. Litig., 89 F. Supp. 2d at 1340. 

424 SEC v. Zandford, 535 U.S. 813, 819 (2002) (courts should interpret the “in connection with” 

requirement broadly to effectuate the remedial purpose of the federal securities laws); SEC v. Merkin, 

2012 WL 5245561 *8 (S.D. Fla. Oct. 3, 2012) (the “in connection with” requirement is satisfied if 

the SEC shows that the material misrepresentations were relayed to the public in a way that a 

reasonable investor would rely on them) (internal citation omitted). 

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h. The Defendants’ Conduct Involved Interstate Commerce 

The Defendants’ conduct has clearly involved the use of interstate commerce. They 

advertise and tout the investments on the Internet, on Facebook pages, and through emails. 

Investors wire investment funds to Par Funding and the Agent Fund Defendants. Par Funding 

emails promissory notes to the Agent Funds, and the Agent Funds email promissory notes and 

offering materials to the investors. Abbonizio and Furman also solicit investors via telephone. 

For all the foregoing reasons, the Commission has established a prima facie case that the 

Defendants have violated and continue to violate the securities laws. 

C. The Defendants Are Likely to Continue to Violate the Securities Laws 

By making a prima facie showing that the Defendants are violating the federal securities 

laws, the Commission has met the first prong of the two-prong test to determine whether the Court 

should issue a temporary restraining order. To meet the second prong, the Commission must show 

a “reasonable likelihood” of future violations. 

In assessing whether there is a reasonable likelihood of future violations, courts look to the 

following factors: (1) the egregiousness of defendant's actions; (2) the isolated or recurrent nature 

of the infractton; (3) the degree of scienter involved; (4) the sincerity of a defendant's assurances 

against future violations; (5) the defendant's recognition of the wrongful nature of the conduct: and 

(6) likelihood of opportunities for future violations.425 Past illegal conduct is highly suggestive 

of the likelihood of future violations.426 

In this case, each of the factors weighs heavily in favor of the Court granting a temporary 

restraining order. First, the Defendants’ conduct is egregious. They are soliciting investors in an 

unregistered and fraudulent securities offering scheme. The Defendants lure investors through a 

series of misrepresentations and omissions about the success, safety, operations, and management 

of the Par Funding business, which is ultimately responsible for generating returns; the use of 

investor funds; the criminal history of Par Funding’s control person; and the regulatory history of 

                                                            

425 Unique, 119 F. Supp. 2d at 1340. 

426 CFTC v. Matrix Trading Group, 2002 WL 31936799 at *12 (S.D. Fla. Oct. 3, 2002). 

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Par Funding, ABFP, Abbonizio, and Vagnozzi, which includes Cease-and-Desist Orders issued in 

connection with the Par Funding securities offering. Second, the conduct is not isolated. It has 

spanned years. The Defendants have together raised more than $482 million from the unsuspecting 

public. Third, the Defendant’s conduct involves a high degree of scienter. They lied and omitted 

material facts with reckless abandon and engaged in a fraudulent scheme to raise money from 

investors using a structure engineered to conceal the truth from investors. 

As to the fourth and fifth factors, the Defendants have not given any assurances against 

future misconduct and plainly do not believe their conduct is wrong. Finally, unless this Court 

restrains and enjoins the Defendants, they will have the opportunity to continue exactly as they 

have been. 

When it comes to Orders issued to enforce securities laws against the Defendants, they 

ignore the Order, lie about the Order, give false assurances that they will not violate again, and/or 

scheme to conceal the truth and circumvent the Order. Pennsylvania issued an Order against Par 

Funding based on it securities law violations in connection with the offer and sale of Par Funding 

notes. Par Funding assured the Regulators it had ended its violative practices. In truth, the 

Defendants simply shifted their scheme, concealed the truth, and expanded the offering – all to 

continue their massive unregistered securities offering operation. 

Next, New Jersey issued an Order against Par Funding based on its securities law violations 

in connection with offering Par Funding promissory notes. The Defendants kept it a secret from 

investors, and Furman lied and told an individual posing as an investor that New Jersey had 

“retracted” its Order and essentially blessed the offering. Incredibly, when Par Funding’s ACH 

processing company, Actum, directly inquired of Par Funding about the New Jersey Order, Cole 

chose to lie. On December 31, 2018, Actum wrote to Cole, “The Cease and Desist Order out of 

NJ has come to our attention and we’d like to get your response.” Cole responded that Par Funding 

intended to have the Order dismissed because the Par Funding promissory notes are not securities. 

Incredibly, Cole told Acum that this position “was further substantiated from the settlement we 

had with the PA Department of Banking last month. They concurred that the creditor note and 

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security agreements we issued are not securities and we expect New Jersey to follow suit.” Based 

on this response, Actum replied that it “finds the matter satisfactory at this time.”427 

In truth, The Pennsylvania Department of Banking and Securities did not concur that the 

notes and security agreements were not securities. To the contrary, the Order, to which Par 

Funding consented, states: “Based on the results of its investigation, the Bureau [of Securities and 

Compliance and Enforcement of the Pennsylvania Department of Banking and Securities] has 

concluded that CBSG has engaged in certain securities-related activities in violation of 

Pennsylvania Securities Act of 1972, 70 P.S. § 1-301.” The Order goes on to state that Par 

Funding/CBSG violated the law by employing an unregistered agent to offer and sell promissory 

notes.428 The Order also states that Par Funding had ceased its Finders Agreements as of February 

8, 2018 and “[a]s of February 8, 2018, CBSG does not pay any compensation to any person in 

connection [with] the sale of the Notes.”429 Indeed, on February 5, 2018, Par Funding assured the 

Pennsylvania Regulators it had terminated its practice of using Finders.430 

In truth, when Par Funding made these assurances to Pennsylvania, it had already converted 

its Finders into “Agents” who continued to sell the Notes through promissory notes and whom Par 

Funding compensated – and continues to compensate for funneling investor money to Par Funding. 

Specifically and as set forth above, the Agent Funds sell promissory notes to investors at one rate 

of interest, funnel the investor money to Par Funding, and Par Funding issues a promissory note 

to the Agent Fund that provides a higher rate of interest and thus a greater return. Par Funding 

pays the Agent Funds each month and the Agent Funds distribute investors their portion of the 

                                                            

427 Exhibit 108, at pdf pp. 12-14 of 71 (emphasis added). 

428 Exhibit 8 at ¶ 5. 

429 Id. at ¶¶ 5-6 (emphasis added). 

430 Exhibit 163, February 5, 2018 Par Funding letter to Pennsylvania Regulators, at pdf pg. 3 of 9 

(“CBSG has entered to contracts with "finders" who have received compensation for finding 

individuals who met the definition of Accredited Investor in Rule 501 of SEC Regulation D to 

purchase notes issued by CBSG. Upon advice of counsel retained in the above-captioned matter, 

CBSG advises that it has terminated this practice with immediate effect and until CBSG has 

received further advice and direction from the Department.”). 

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returns and pocket the remainder as their compensation, giving Vagnozzi a 25% cut as his 

compensation pursuant to a written agreement. 

Next, in May 2019, Pennsylvania filed a consent Order against Vagnozzi for violating the 

registration requirements of the Pennsylvania Securities Act in connection with his offer of Par 

Funding Promissory Notes.431 Undeterred, Vagnozzi continued his unregistered securities 

offerings, selling promissory notes in his own funds and funneling the money to Par Funding in 

exchange for more profitable promissory notes through which he was compensated. 

In February 2020, the Texas Securities Regulators entered a Cease and Desist Order against 

Par Funding, Abbonizio, ABFP, and Vagnozzi for, among other things, engaging in fraud in 

connection with the offer and sale of promissory notes by not disclosing the New Jersey and 

Pennsylvania Orders and LaForte’s history to investors.432 This matter remains pending. And 

still, as set forth above, these Defendants continued their unregistered securities offerings and 

continued to conceal the regulatory history and LaForte’s history to investors. 

And most recently, on July 14, 2020, the Commission issued a consent Order against 

Vagnozzi and ABFP in connection with four offerings that are unrelated to the Par Funding 

offering in this case.433 Just days later, Vagnozzi and ABFO issued a press release and emailed 

Par Funding investors, mischaracterizing what the Order states and incredibly, using the Order to 

solicit further investments from Par Funding investors. 

It is clear the Defendants have no respect for the securities laws or Orders issued against 

them. They continue to solicit investors and engage in the offering, and the Defendants’ history 

and the egregiousness of their conduct show that nothing short of the emergency relief sought in 

this case will protect investor funds. 

                                                            

431 Exhibit 9. 432 Exhibit 37. 433 Exhibit 160. 

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V. RELIEF REQUESTED 

A. An Ex Parte Temporary Restraining Order is Necessary

 Through the facts and legal arguments set forth above, the Commission has met its burden of 

showing (1) there is prima facie evidence that all of the Defendants are violating the securities laws 

and (2) there is a reasonable likelihood they will continue to violate the law unless the Court 

immediately issues an ex parte temporary restraining order. As our accompanying Certification 

Under Rule 65 as to why we are not providing the Defendants and Relief notice explains in more 

detail, we have grave concerns that they will dissipate investor assets if we do. 

 They currently control millions of dollars of investor funds, ABFP and Vagnozzi have 

announced they are planning to expand into a public offering, and Par Funding has already 

distributed investor funds to enrich McElhone and Cole – and lied about it to the Commission in 

their filings. Par Funding, Furman, and Vagnozzi also solicited investors to exchange their 

promissory notes for notes offering a fraction of the investment returns – leaving the Agent Funds 

and Par Funding with significantly less debt to repay and more of the investment returns within 

their control. Many of the Defendants currently have an application pending to purchase a bank 

in Bells, Texas, and as of July 10, 2020, they were still pursuing that process.434 Given the ongoing 

nature of the fraud the Defendants are committing and the significant risk of loss to the investors, 

we ask the Court to enter the attached proposed order granting this temporary restraining order and 

entering the asset freeze without notice to the Defendants to prevent them from transferring 

investor funds and further harming investors. There are concerns that more investors will be 

defrauded, since the Defendants continue to solicit investors. 

 We will immediately serve all Defendants and the Relief Defendant with the pleadings and 

orders, and the attached proposed order asks the Court to set a show cause hearing at which time 

the Defendants and Relief Defendant can appear and argue why the Court should not enter a 

preliminary injunction and further extend the asset freeze order. 

                                                            

434 Exhibit 126 at 87:16-24, 98:8-21, 99:22-100:2; Exhibit 129 (Late-June meeting about bank). 

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B. An Ex Parte Freeze of Assets Is Necessary 

 Pursuant to their general equity powers, federal courts may order ancillary relief to 

effectuate the purposes of the federal securities laws, both to preserve defendants’ assets and 

ensure wrongdoers do not profit from their unlawful conduct.435 An asset freeze “facilitate[s] 

enforcement of any disgorgement remedy that might be ordered” and may be granted “even in 

circumstances where the elements required to support a traditional SEC injunction have not been 

established.”436 It is well recognized an asset freeze is sometimes necessary to ensure a future 

disgorgement order will not be rendered meaningless.437 When there are concerns that defendants 

might dissipate assets, or transfer or secret assets beyond the jurisdiction of the Court, this Court 

need only find some basis for inferring a violation of the federal securities laws in order to impose 

a freeze.438 Here, there is great concern that the Defendants might dissipate assets. Par Funding 

has already siphoned investor funds to McElhone and Cole while concealing this information from 

the Commission in their Form D filings. As set forth in the Declaration from Melissa Davis filed 

with this Motion, in June 2020, Par Funding transferred millions from the Par Funding, leaving 

only thousands in its bank account. Vagnozzi, Abbonizio, Cole, and LaForte currently attempting 

to acquire a bank in Dallas, Texas. As Cole recently explained to two individuals posing as 

investors, they are buying a bank to “pump up our MCA business” and there are no usury laws in 

effect if they run Loans through this bank.439. 

                                                            

435 See, e.g., Unifund SAL, 910 F.2d at 1041; SEC v. Wencke, 622 F.2d 1363, 1369 (9th Cir. 1980); 

Manor Nursing Centers, 458 F.2d at 1103-04. An asset freeze is appropriate “as a means of 

preserving funds for the equitable remedy of disgorgement.” SEC v. ETS Payphones, Inc., 408 

F.3d 727, 734 (11th Cir. 2005). 

436 Unifund SAL, 910 F.2d at 1041. 

437 Manor Nursing Centers, 458 F.2d at 1106; United States v. Cannistraro, 694 F. Supp. 62, 71-

72 (D.N.J. 1988), aff'd in part, vacated in part, 871 F.2d 1210 (3d Cir. 1989); SEC v. Vaskevitch, 

657 F. Supp. 312, 315 (S.D.N.Y. 1987). 

438 Unifund SAL, 910 F.2d at 1041-42; SEC v. Tyler, 2002 U.S. Dist. Lexis 2952 (N.D. Tex. 

February 22, 2002); SEC v. Comcoa, Ltd., 887 F. Supp. 1521, 1524 (S.D. Fla. 1995); SEC v. 

Margolin, 1992 U.S. Dist. Lexis 14872 at 19-20 (S.D.N.Y. Sept. 30, 1992); SEC v. Grossman, 

1987 U.S. Dist. Lexis 1666 at *35-36 (S.D.N.Y. Feb 17, 1987). 

439 Exhibit 129, part 2, at 401:3-408:14, and 420:24-421:18. 

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 The Court should impose an asset freeze against the following Defendants and Relief 

Defendants up to the amount of ill-gotten gains they received through their fraudulent and 

unregistered securities offerings: 

 Par Funding, McElhone, and LaForte, jointly and severally, in the amount of 

 $492,398,894.440 

 Joint and several with Par Funding, McElhone, and LaForte: 

 Full Spectrum in the amount of $4,398,535441

 ABFP in the amount of $1,914,045;442 

 ABFP Income Fund and ABFP, jointly and severally, in the amount of 

$25,487,690;443 

 ABFP Income Fund 2 in the amount of $13,252,600;444 

 Fidelis Financial and United Fidelis, jointly and severally, in the amount of 

$11,603,000;445 

 Retirement Evolution Group in the amount of $6.5 million;446

 RE Fund in the amount of $5,450,000;447

 RE Fund 2 in the amount of $150,000;448 

 Cole in the amount of $16,159,000;449 and 

 Relief Defendant L.M.E. 2017 Family Trust in the amount of $14.3 

million.450

                                                            

440 This is the amount raised from investors from July 2015 through the most recent bank 

statements available to us. Exhibit 13 at ¶ 10. McElhone and LaForte are control persons. 

441 Id. at ¶ 11. 

442 Exhibit 56, Form D Filing of ABFP. 

443 Based on the amount ABFP raised through ABFP Income Fund that it funneled to Par Funding, 

Exhibit 13 at ¶ 11. 444 Based on the amount ABFP raised through ABFP Income Fund that it funneled to Par Funding. 

Id. at ¶ 11. 

445 This is the amount Fidelis Financial raised and funneled to Par Funding. As Manager of Fidelis 

Financial, United Fidelis is jointly and severally liable for this amount. Id. at ¶ 11. 

446 Id. at ¶ 11. 

447 Based on the amount it admits it raised from investors in its Form D filing. Exhibit 58. 448 Based on the amount it admits it raised from investors in its Form D filing, Exhibit 145. 449 The amount, which included investor funds, received from Par Funding through Cole’s 

“consulting” companies, as set forth above. Id. at ¶¶ 13-15. 

450 Exhibit 13, at ¶ 16. 

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 The Commission is not seeking an asset freeze against Abbonizio, Vagnozzi, Furman or 

Gissas personally at this time because we are unable to determine at this stage what they received 

ill-gotten gains and requires expedited discovery on this and other matters in this case. We also 

require expedited discovery to determine how much ABFP Management received in ill-gotten 

gains from the unregistered offering fraud scheme. 

 Here, the evidence shows that Par Funding, directly and through its network of Agent 

Funds which includes Vagnozzi, Furman, and Gissas, has raised more than $482 million from 

about 1,200 investors nationwide and it is actively seeking investors. In June 2020, Par Funding 

emptied most of the balance in its bank account by transferring funds, including investor funds, to 

a company called “Par Fund Pref.”451 As set forth above, Relief Defendant is a Trust for which 

McElhone is the grantor. McElhone controls the Par Funding bank accounts and there have already 

been transfers of investor funds to the Trust with no legitimate basis. Cole, as CFO, signed the 

filing with the Commission stating that he and McElhone received no proceeds of the offerings, 

when in truth he has received millions of funds through “consulting” firms and as CFO, he knows 

or is reckless for not knowing Par Funding transferred $11.3 million to McElhone. Vagnozzi, 

ABFP, the ABFP Income Funds, United Fidelis, Fidelis Financial, Retirement Evolution, and the 

RE Funds have all raised money from investors by making materials misrepresentations and 

omissions in connection with unregistered securities offerings. The Defendants have continued 

their scheme despite numerous Orders from state securities regulators against Par Funding, ABFP, 

Vagnozzi, and/or Abbonizio for violating the securities laws in connection with the very securities 

offerings at issue in this case. 

 A freeze over the Defendants’ current bank accounts, as well as any other assets they might 

possess, is necessary to protect the investors’ funds. Given the egregious nature of this fraud, the 

fact that Par Funding has already dissipated investor proceeds while lying to the Commission in 

its Form D filings about who is receiving the proceedings of its offering, and lying to investors in 

                                                            

451 Id. at ¶ 19. 

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order to lure them into contributing money in the offering, combined with the fact that any 

remaining assets are at risk, an order freezing assets to aid in the potential recovery and return of 

investor funds is necessary. 

 Accordingly, the Commission requests that this Court enter an Order granting an 

immediate asset freeze over any and all of the assets of Defendants and Relief Defendant, and 

thereafter, enter a preliminary injunction freezing assets through the conclusion of this action. 

C. Sworn Accountings 

 Sworn accountings are necessary to enable the Commission and the Court to determine the 

amounts the Defendants have raised and spent in perpetration of their fraud, and to enable the 

Court to determine the proper amount of disgorgement. Federal courts have frequently applied 

their broad powers in the context of Commission actions to prevent securities violators from 

enjoying the fruits of their misconduct.452 Here, an accounting is needed to determine: (1) the 

amount of the Defendants’ unjust enrichment; (2) the disposition of the proceeds of the securities 

sales; and (3) the assets available for disgorgement. 

D. An Order Prohibiting Destruction of Records And Expediting Discovery 

 Orders prohibiting the destruction of records and expediting discovery are both appropriate 

to prevent the destruction of documents before this Court can adjudicate the Commission’s claims, 

and to ensure that whatever equitable relief might ultimately be appropriate is available.453 The 

Court should order expedited discovery so that the Commission may take meaningful discovery in 

the fourteen-day period between entry of the temporary restraining order and any hearing on the 

show-cause order why the Court should not grant a preliminary injunction. Consequently, we ask 

the Court to enter an order allowing the parties to take depositions on two days notice and to serve 

written discovery requiring a response within two days. In addition, to preserve the Commission’s 

                                                            

452 Manor Nursing Centers, 458 F.2d at 1104 (“The effective enforcement of the federal securities 

laws requires that the SEC be able to make violations unprofitable. The deterrent effect of a 

Commission enforcement action would be greatly undermined if securities law violators were not 

required to disgorge illicit profits.”). 

453 SEC v. R.J. Allen & Assocs., Inc., 386 F. Supp. 866, 881 (S.D. Fla. 1974). 

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ability to take effective discovery, the Court should order the Defendants and Relief Defendant not 

to alter or destroy relevant documents.

VI. CONCLUSION

 For the foregoing reasons, the Court should grant the Commission’s Motion for Temporary 

Restraining Order and Other Emergency Relief and issue the accompanying proposed Order. 

July 24, 2020 Respectfully submitted, 

 

 

 By: s/Amie Riggle Berlin 

 Amie Riggle Berlin 

Senior Trial Counsel 

Florida Bar No. 630020 

Direct Dial: (305) 982-6322 

Direct email: berlina@sec.gov 

 Attorney for Plaintiff 

 SECURITIES AND EXCHANGE 

 COMMISSION 

 801 Brickell Avenue, Suite 1800 

 Miami, Florida 33131 

 Telephone: (305) 982-6300 

 Facsimile: (305) 536-4154 

Certificate of Conferral 

This motion is filed ex parte and is being filed under seal. Counsel did not confer with the 

Defendants or their counsel prior to filing for the reasons stated in the Rule 65 Cert. and in this 

Motion as to why ex parte and emergency relief is being sought. 

 s/Amie Riggle Berlin

Case 9:20-cv-81205-RAR Document 14 Entered on FLSD Docket 07/27/2020 Page 81 of 81