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A Bergen County man and his New York business associate are facing a civil enforcement action filed by the New Jersey Bureau of Securities with the Division of Consumer Affairs for defrauding at least one New Jersey investor in an investment scheme tied to a job recruiting software service that they were allegedly trying to grow, according to the New Jersey Office of the Attorney General.

Michael Lakshin. of Fair Lawn, and Edward Aizman. of Brooklyn, as well as their company Bowmo, Inc. used “fraud and deception,” allegedly convincing one of Lakshin’s childhood friends to liquidate her retirement fund and invest in their start-up business venture, according to a civil complaint filed in Bergen County on Friday. They then allegedly diverted most of the funds for their own personal use including cash advances, hotel stays and purchases at car dealerships and designer stores among other expenditures.

“The defendants in this case shamelessly bankrolled their lavish lifestyles with someone else’s hard-earned retirement savings,” said Attorney General Matthew J. Platkin. “The lawsuit announced today sends a clear message that this kind of blatant exploitation of investors will not go unpunished in New Jersey.”

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The complaint alleges, according to the Office of the Attorney General, that from April through August 2020, Lakshin, Aizman and Bowmo (through Lakshin and Aizman), offered and sold at least $84,681.19 of Bowmo’s securities in the form of a convertible note to at least one NJ investor.

They told the investor that the Bowmo note was an investment opportunity which would provide her a “significantly higher return” than her retirement savings. They allegedly told her that Bowmo was successful, bringing in a lot of money through its success and that she could profit by investing her funds into the company.

Lakshin also allegedly leveraged their childhood connection to convince her to invest. After learning about the investor’s retirement account, Lakshin allegedly pressured her to liquidate the account for the purpose of buying the Bowmo note.

Lakshin assured the investor that she would “realistically” be able to earn “A MUCH GREATER return,” through a series of text messages, falsely informed the investor that she should not have any taxes or penalties withheld when withdrawing funds from her account, and assured her that Bowmo would reimburse her for any taxes or penalties that would have to be paid as a result of the liquidation.

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On June 25, 2020, the investor liquidated her retirement account. This liquidation included two charges and exposed her to paying taxes on the funds as she was not “rolling them over to another qualified retirement plan,” according to the Office of the Attorney General .

On July 2, 2020, the investor met with Lakshin and Aizman and signed a Bowmo subscription agreement. She wired $84,681.19 from her bank account to a Bowmo bank account controlled by Lakshin and Aizman later that month.

A Bowmo investor package provided to the investor prior to investing said that funds would be used to further develop Bowmo’s software, expand its marketing business, and make strategic hires among other business-related ventures.

Instead, the defendants allegedly transferred the funds to bank accounts held by a seperate and unrelated entity and misused the funds by diverting them for personal and non-business-related purposes.

The lawsuit seeks a court order to permanently ban Bowmo, its president and chairman Lakshin, and its founder and CEO Aizman, from issuing, offering, or selling securities in New Jersey, according to the Office of the Attorney General. It also asks the court to assess civil monetary penalties, restitution plus interest and expenses for the victim, and disgorgement of all funds and profits gained from the scheme.

According to Bureau Chief Elizabeth M. Harris, this case “serves as a sobering example of why it’s vitally important to investigate investment products, even those offered by someone you know and trust.”

She continued, “It’s also an opportunity to remind our residents that while fraudulent investment schemes come in a variety of forms, the pressure to act fast to avoid missing out on a hot investment is a universal red flag of fraud that should not be ignored. In addition to doing their due diligence before investing, we urge New Jerseyans to follow their instincts when a transaction doesn’t pass the smell test.”

Investors can obtain information about any financial professional doing business to or from New Jersey by visiting the Bureau’s website at www.NJSecurities.gov, or calling the Bureau within New Jersey at 1-866-446-8378 or from outside New Jersey at 973-504-3600.