The U.S. Securities and Exchange Commission on Tuesday charged the town of Oyster Bay and former Town Supervisor John Venditto with defrauding investors for failing to disclose loan guarantees in bond documents.
The SEC’s civil lawsuit, filed in U.S. District Court Eastern Division in Central Islip, also calls for a court-appointed consultant to oversee municipal financial reporting. The agency also seeks a five-year ban on the town selling of securities without first implementing recommendations of the independent consultant, who is to “review and recommend improvements in the towns’ financial reporting policies.”
The lawsuit also noted that Venditto invoked his Fifth Amendment right against self-incrimination when he was interviewed by SEC attorneys. The suit seeks unspecified monetary penalties from the town and Venditto.
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