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The National Planning Corporation has agreed to make restitution of more than $3.6 million, plus 6 percent interest, to Massachusetts investors who were sold highly speculative and unregistered promissory notes by a Plymouth man who was an agent of the corporation at the time, Secretary of State William F. Galvin said Tuesday.
Earlier this year, the Securities Division of Galvin’s office charged Economic Development Finance Corp. and Economic Development Funding Corp. (EDFC), both of Dedham, with selling unregistered, high-risk securities to seniors through an unregistered broker, Boston South Financial Inc. of Hingham. Boston South and its principal, Robert Blaisdell, were also charged with fraud in connection with the sales.
Galvin said Blaisdell mainly targeted senior citizens at various senior centers and churches.
Blaisdell worked as an agent of National Planning Corporation from November 2006 to December 2008, but his sale of promissory notes issued through the Dedham companies was done outside his work at National Planning Corporation and without its approval, according to a statement from Galvin’s office.
Between June and December 2008, Blaisdell sold EDFC notes to his National Planning Corporation investors and transferred many National Planning Corporation investors’ assets from National Planning Corporation-approved securities to EDFC notes, according to Galvin’s office. In that time period Blaisdell’s company was paid more than $125,000 in commissions by EDFC, none of which was disclosed to National Planning Corporation, according to Galvin.
As part of its investigation, the securities division also found evidence that “National Planning Corporation failed to reasonably supervise Blaisdell in that 2008 period, which constitutes a violation of the Massachusetts Uniform Securities Act,” according to the statement from Galvin’s office.
In the settlement National Planning Corporation agreed to provide full restitution to the identified investors in the amount of $3.9 million including the initial investment plus interest, “but there is a provision for restitution to any additional investors who bought EDFC notes from Blaisdell between January 2008 and March 1, 2009 if the Securities Division learns of their existence,” according to the statement. The settlement also requires National Planning Corporation to hire an independent consultant to assess the company’s compliance procedures, recommend any necessary changes, and report its finding to the securities division. Galvin’s office said the security division’s charges against EDFC, Boston South, and Blaisdell remain outstanding.
The National Planning Corporation has agreed to make restitution of more than $3.6 million, plus 6 percent interest, to Massachusetts investors who were sold highly speculative and unregistered promissory notes by a Plymouth man who was an agent of the corporation at the time, Secretary of State William F. Galvin said Tuesday.
Earlier this year, the Securities Division of Galvin’s office charged Economic Development Finance Corp. and Economic Development Funding Corp. (EDFC), both of Dedham, with selling unregistered, high-risk securities to seniors through an unregistered broker, Boston South Financial Inc. of Hingham. Boston South and its principal, Robert Blaisdell, were also charged with fraud in connection with the sales.
Galvin said Blaisdell mainly targeted senior citizens at various senior centers and churches.
Blaisdell worked as an agent of National Planning Corporation from November 2006 to December 2008, but his sale of promissory notes issued through the Dedham companies was done outside his work at National Planning Corporation and without its approval, according to a statement from Galvin’s office.
Between June and December 2008, Blaisdell sold EDFC notes to his National Planning Corporation investors and transferred many National Planning Corporation investors’ assets from National Planning Corporation-approved securities to EDFC notes, according to Galvin’s office. In that time period Blaisdell’s company was paid more than $125,000 in commissions by EDFC, none of which was disclosed to National Planning Corporation, according to Galvin.
As part of its investigation, the securities division also found evidence that “National Planning Corporation failed to reasonably supervise Blaisdell in that 2008 period, which constitutes a violation of the Massachusetts Uniform Securities Act,” according to the statement from Galvin’s office.
In the settlement National Planning Corporation agreed to provide full restitution to the identified investors in the amount of $3.9 million including the initial investment plus interest, “but there is a provision for restitution to any additional investors who bought EDFC notes from Blaisdell between January 2008 and March 1, 2009 if the Securities Division learns of their existence,” according to the statement. The settlement also requires National Planning Corporation to hire an independent consultant to assess the company’s compliance procedures, recommend any necessary changes, and report its finding to the securities division. Galvin’s office said the security division’s charges against EDFC, Boston South, and Blaisdell remain outstanding.
