An Old Bridge man was sentenced to seven years in state prison after admitting he orchestrated a $7.7 million investment fraud scheme using fake fuel companies, a Ponzi-style operation, and fabricated business opportunities.
A Middlesex County man who defrauded investors out of approximately $7.7 million through a complex securities fraud scheme involving fictitious fuel companies has been sentenced to state prison, New Jersey Attorney General Jennifer Davenport announced.
Shahid Javed, 41, of Old Bridge, was sentenced June 18 to seven years in New Jersey State Prison after pleading guilty to two counts of second-degree securities fraud and one count of second-degree theft by deception.
In addition to the prison sentence, Superior Court Judge Ralph E. Amirata ordered Javed to pay $250,000 in restitution. Javed entered his guilty plea in Morris County Superior Court in April.
Fake Fuel Companies Used to Attract Investors
According to prosecutors, Javed admitted that between March 2018 and May 2023 he carried out a long-running fraud scheme that targeted investors seeking legitimate business opportunities.
The scheme began when Javed obtained approximately $640,000 in purported loans through his company, East Coast Energy Partners, claiming the money would be used to purchase and sell jet fuel. Instead, prosecutors said he diverted the funds for personal use.
Investigators later discovered Javed created two fraudulent New Jersey businesses, Prime Petroleum Group LLC and Petro Traders Group LLC, and falsely represented them as successful fuel-trading companies.
Authorities said Javed claimed the companies generated substantial profits through fuel sales and ownership interests in a Texas oil refinery.
Ponzi Scheme Funded Luxury Lifestyle
To convince victims to invest more money, Javed promised returns of up to 50 percent along with repayment of their original investments.
Rather than generating legitimate profits, prosecutors said he operated a Ponzi scheme, using new investor funds to make approximately $1 million in payments to earlier investors.
Authorities said Javed also impersonated fictitious employees of the fake companies to further the fraud and create the appearance of legitimate business operations.
According to court records, investor funds were used to pay personal creditors and finance luxury purchases, including a Bentley, a boat, and a home.
Officials Highlight Financial Crime Enforcement
Attorney General Davenport said the case demonstrates New Jersey’s commitment to prosecuting complex financial crimes.
“This case represents our continuing effort to ensure that individuals who engage in securities fraud and complex financial crimes against vulnerable victims are held accountable in New Jersey,” Davenport said. “The defendant stole from hardworking New Jerseyans who were simply looking for ways to invest their money wisely.”
Division of Criminal Justice Director Theresa L. Hilton said Javed admitted to leading a scheme designed to enrich himself at the expense of investors.
“The defendant admitted his role in leading a complex scheme to defraud investors of millions of dollars to line his own pockets,” Hilton said. “He used dishonest tactics and made false claims to swindle his victims.”
Investigation Spanned Multiple Years
The case was prosecuted by Deputy Attorney General Jack Daily of the Office of Securities Fraud and Financial Crimes Prosecutions.
Investigators from the Division of Criminal Justice, including detectives and financial crime investigators assigned to the Office of Securities Fraud and Financial Crimes Prosecutions, assisted in the investigation.
A codefendant charged in the case remains pending trial.
Key Points
• Old Bridge resident Shahid Javed was sentenced to seven years in prison for a $7.7 million securities fraud scheme.
• Prosecutors said Javed created fake fuel companies and operated a Ponzi-style investment fraud between 2018 and 2023.
• Investor funds were used for personal expenses, including a Bentley, a boat, and a home.