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Second NJ exec pleads guilty to online fraud

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CIOL Bureau
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NEW YORK, USA: A New Jersey man has pleaded guilty to defrauding clients out of $10.2 million after being accused of running a scam on Craigslist and other websites, joining a colleague who pleaded guilty two weeks ago.

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Paul Bultmeyer, 70, admitted on Wednesday to one count of conspiracy to commit wire fraud before U.S. District Judge Jose Linares in Newark, New Jersey, U.S. Attorney Paul Fishman said.

The Upper Saddle River resident was released on bail pending a Sept. 1 sentencing. He faces a maximum 20 years in prison, and agreed to make $10.2 million of restitution to victims.

His colleague, Arthur Piacentini of Saddle Brook, New Jersey, pleaded guilty to an identical charge on May 5.

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Investigators including the U.S. Securities and Exchange Commission accused Bultmeyer and Piacentini of diverting money from clients they attracted through advertisements in print publications and on Craiglist and other Internet sites, despite saying they were investing it safely.

According to investigators, the men diverted money from clients of their Sherbourne Capital Management Ltd and Sherbourne Financial Ltd to their payroll services company, Ameripay LLC, and diverted money from Ameripay clients to cover other obligations.

Fishman said the scheme ran from December 2004 to May 2009. The SEC filed a parallel civil case against the two defendants last May, and won a freeze of the three companies' assets.

A lawyer for Bultmeyer did not immediately return a call seeking comment.

The criminal case is U.S. v. Bultmeyer, U.S. District Court, District of New Jersey, No. 09-06093.

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