SEC v. SYNERGY SETTLEMENT SERVICES, INC.; FOUNDATION FOR THOSE WITH SPECIAL NEEDS INC.; SPECIAL NEEDS LAW FIRM PLLC; JASON D. LAZARUS; and ANTHONY F. PRIETO, JR., No. 6:22-cv-00820, Middle District of Florida (May 2, 2022) — Complaint

UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF FLORIDA

ORLANDO DIVISION

CASE NO. ____________

SECURITIES AND EXCHANGE COMMISSION,

   Plaintiff,
v.

SYNERGY SETTLEMENT SERVICES, INC.,
FOUNDATION FOR THOSE WITH SPECIAL
NEEDS INC.,
SPECIAL NEEDS LAW FIRM PLLC,
JASON D. LAZARUS,          and
ANTHONY F. PRIETO, JR.

Defendants.
_________________________________________________/

COMPLAINT AND DEMAND FOR JURY TRIAL
Plaintiff Securities and Exchange Commission alleges:
I.  INTRODUCTION
1. The  Commission  brings  this  action  to  enjoin  the  Defendants’
fraudulent  operation  of  two  purportedly  charitable  pooled  investment  trusts
with $46 million in assets and more than 380 trust members, most of whom
are disabled recipients of Medicaid or Social Security Supplemental Security
Income (“SSI”) benefits.
2. Section 1917 of the Social Security Act, 42 U.S.C. § 1396p, allows

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Medicaid  and  SSI  recipients  to  remain  eligible  for  benefits  despite  receiving
assets (such as awards or settlements in personal injury lawsuits) that would
otherwise disqualify them from receiving that government assistance, as long
as they place those assets in an irrevocable trust established and managed by
a non-profit association.
3. From no later than May 2015 through the present, the Defendants
have  marketed,  sold  investments  in,  and  operated  two  pooled  investment
trusts purportedly established and managed by a non-profit entity as required
by Section 1396p.  In reality, however, the entity named as the trustee of the
two   trusts,   Defendant   Foundation   for   Those   with   Special   Needs,   Inc.,
(“Foundation”) is a shell corporation with no operations or employees.
4. Defendants  Synergy  Settlement  Services,  Inc.  (“Synergy”),  Jason
D.  Lazarus,  and  Anthony  F.  Prieto,  Jr.  have  installed  the  Foundation  as  a
nominee  trustee  to  attempt  to  hide  the  fact  that  Synergy,  a  for-profit
corporation,  Lazarus  and  Prieto  perform  all  the  trustee  functions  and  profit
from the trusts’ operations by collecting all fees and other funds stemming from
operating the trusts.
5. The  Defendants’  operation  of  the  pooled  trusts  has  violated  the
antifraud and registration provisions of the federal securities laws in several
ways.    First,  Synergy,  Lazarus,  Prieto,  and  Defendant  Special  Needs  Law

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Firm,   PLLC   (“the   Law   Firm”)   have   misrepresented   to   potential   trust
beneficiaries  that  they  would  be  joining  a  trust  managed  by  a  non-profit
association  under  Section  1396p,  and  therefore  would  remain  eligible  for
Medicaid  and  SSI  benefits.    To  the  contrary,  because  Synergy,  Lazarus,  and
Prieto  operated  and  managed  the  trusts  for  their  own  profit,  they  created  a
situation  where  the  trust  funds  could  count  as  beneficiaries’  assets  and
jeopardize their Medicaid and SSI benefits.
6. Synergy,   Lazarus,   and   Prieto   have   lied   about   the   for-profit
operation and management of the trusts to beneficiaries, the Internal Revenue
Service, and the Social Security Administration (“SSA”), through emails, firm
brochures, marketing materials, trust documents and operating agreements,
among other documents.
7. In addition, Synergy, Lazarus, and Prieto improperly diverted all
trustee  fees,  which  come  directly  from  beneficiaries’  accounts,  to  Synergy.
These  Defendants  also  improperly  used  funds  from  deceased  beneficiaries’
accounts to reimburse themselves for employee salaries and other expenses, as
well  as  to  make  donations  to  trial  lawyers’  and  other  organizations  that
violated their representations to the IRS and beneficiaries that they would only
use such funds to further the trusts’ mission to help the disabled.
8. Synergy, Lazarus, and Prieto have also misled beneficiaries with

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respect to the investment of the pooled trusts’ assets.  From 2015 to 2017, the
Defendants  did  not  tell  beneficiaries  they  were  investing  their  money  in  a
certain  class  of  mutual  fund  that  doubled  the  fees  the  Defendants  told  the
beneficiaries they were paying.
9. The trusts are invested in securities, and the trust instruments are
securities the Defendants are offering and selling to beneficiaries.  Because the
trusts are not operated and managed by a non-profit association, they do not
qualify for exemptions from registration available to charitable organizations
under the securities laws, and the Defendants have violated the registration
requirements  by  offering  and  selling  investments  in  the  trusts  without
registering the offerings with the Commission.
10. As a result of this conduct, the Defendants have violated Sections
5(a), 5(c) and 17(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§
77e(a), 77e(c), 77q(a); Section 10(b) and Rule 10b-5 of the Securities Exchange
Act  of  1934  (“Exchange  Act”),  15  U.S.C.  §  78j(b)  and  17  C.F.R.  §  240.10b-5;
and/or Sections 206(1), 206(2) and 206(4) and Rule 206(4)-8 of the Investment
Advisers  Act  of  1940  (“Advisers  Act”),  15  U.S.C.  §  80b-6(1),  (2),  (4)  and  17
C.F.R. § 275.206(4)-8.
11. The   Commission   requests   that   the   Court   enter   orders:   (i)
permanently  restraining  and  enjoining  the  Defendants  from  violating  these

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provisions  of  the  federal  securities  laws;  (ii)  directing  the  Defendants  to  pay
disgorgement with prejudgment interest; and (iii) directing Synergy, the Law
Firm, Lazarus and Prieto to pay civil money penalties.
II.  DEFENDANTS AND OTHER RELEVANT ENTITIES
A.  Defendants
12. Synergy is a Florida for-profit corporation with its principal place
of business in Orlando, Florida.
13. Foundation  is  a  Florida  non-profit  501(c)(3)  private  foundation
with its principal place of business in Orlando, Florida.
14. The   Law   Firm   is   a   Florida   professional   limited   liability
corporation with its principal place of business in Orlando, Florida.
15. Lazarus,  age  52,  of  Orlando,  Florida,  is  an  attorney  licensed  to
practice  in  the  State  of  Florida.    Lazarus  is  the  chief  executive  officer  and
largest shareholder of Synergy, sole owner of and practitioner at the Law Firm,
and president and a director of the Foundation.
16. Prieto, age 48, of Tampa, Florida, is a Certified Financial Planner
and an investment adviser representative of an investment adviser registered
with  the  Commission.    Prieto  is  president  and  a  minority  owner  of  Synergy,
and a director of the Foundation.  Prieto was an officer of the Foundation until
March 2017.

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   B.  Other Relevant Entities
17. Settlement Solutions National Pooled Trust (“SSNPT”) is a
special  needs  pooled  trust  for  disabled  individuals  that  purports  to  preserve
their Medicaid and SSI benefits pursuant to Section 1396p.  As of April 3, 2022,
SSNPT had 316 beneficiaries and total assets of approximately $30.7 million.
Since May 2015, Foundation has been the named trustee of SSNPT.
18. Settlement Management National Pooled Trust (“SMNPT”)
is a pooled trust for personal injury victims, often minors and incompetents in
lieu  of  guardianship  proceedings.    Per  its  master  trust  agreement,  “[t]he
purpose of [SMNPT] is to provide a vehicle for investment management” for its
beneficiaries.    The  trustee  may,  in  its  discretion,  place  beneficiaries  in  a
Section 1396p trust to qualify for Medicaid or SSI.  As of April 3, 2022, SMNPT
had  65  beneficiaries  and  total  assets  of  approximately  $15.5  million.    Since
March 2016, Foundation has been the named trustee of SMNPT.
III.  JURISDICTION AND VENUE
19. The  Court  has  jurisdiction  over  this  action  pursuant  to  Sections
20(b), 20(d)(1) and 22(a) of the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d)(1) and
77v(a); Sections 21(d), 21(e) and 27(a) of the Exchange Act, 15 U.S.C. §§ 78u(d),
78u(e) and 78aa(a); and Sections 209 and 214 of the Advisers Act, 15 U.S.C. §§
80b-9 and 80b-14.

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20. The  Court  has  personal  jurisdiction  over  the  Defendants  and
venue is proper in this District because, among other things, the Defendants
reside  and  transact  business  in  this  District.    They  also  participated  in  the
offer, purchase, or sale of securities in this District, and many of their acts and
transactions constituting the violations alleged in this Complaint occurred in
this  District.    In  addition,  venue  is  proper  in  this  District  under  28  U.S.C.  §
1391 because a substantial part of the events giving rise to the Commission’s
claims occurred here.
21. In  connection  with  the  conduct  alleged  in  this  Complaint,  the
Defendants, directly and indirectly, singly or in concert with others, have made
use  of  the  means  or  instrumentalities  of  interstate  commerce,  the  means  or
instruments of transportation or communication in interstate commerce, and
of the mails.
IV.  FACTUAL ALLEGATIONS
A.  Special Needs Pooled Trusts
22. Virtually all of the SSNPT or SMNPT beneficiaries are disabled or
incompetent individuals or minors who have received awards or settlements in
personal injury lawsuits.  Section 1396p permits Medicaid and SSI recipients
to   retain   their   benefits   despite   receiving   assets   from   these   awards   or
settlements that would otherwise place them above the income eligibility limits

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for the government assistance.
23. To   retain   eligibility   for   benefits   under   Section   1396p,   the
beneficiaries must place the assets they receive in an irrevocable pooled trust
established  and  managed  by  a  non-profit  association.    The  beneficiaries  can
then  get  approval  from  the  trustee  to  use  the  assets  for  certain  types  of
expenses governed by the statute to supplement their Medicaid or SSI benefits.
24. Section  1396p  expressly  permits  the  assets  of  such  trusts  to  be
pooled for investment purposes, but the assets of each beneficiary must be held
in a separate sub-account to be distributed by the trustee for the sole benefit
of that beneficiary.
25. Upon  the  beneficiary’s  death,  the  trusts  may  retain  the  sub-
account balance (“retained funds”) depending on the requirements of state law,
whether  the  beneficiaries  have  designated  remainder  beneficiaries,  and  the
language of the trust documents.  Trusts that keep retained funds must use
them  in  keeping  with  the  representations  in  trust  documents  and  the  legal
obligations of special needs pooled trusts and their trustees.
26. The   SSA   maintains   a   Program   Operations   Manual   System
(“POMS”)  with  policy  statements,  guidelines  for  Section  1396p  pooled  trust
operations, and interpretations of relevant laws.  The POMS allows non-profit
trustees  to  use  the  services  of  other  entities  to  help  manage  the  trusts.

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However, under the POMS “[i]f a non-profit association employs the services
of  a  for-profit  entity,  the  non-profit  association  must  maintain  ultimate
managerial  control  over  the  trust  .  .  .  [T]he  use  of  a  for-profit  entity  must
always be subordinate to the non-profit managers.”
27. The POMS identifies various forms of authority “that must vest in
the  non-profit  association”  (i.e.,  cannot  be  delegated),  including  determining
the amount of the trust corpus to invest and making the day-to-day decisions
regarding the health and well-being of pooled trust beneficiaries.
B.  The Foundation
28. The Foundation was incorporated in Florida in February 2012.  Its
officers and directors have all been principals or employees of Synergy, and it
shares an address with Synergy.  Lazarus, the largest shareholder of Synergy
and  its  CEO,  is  the  president  and  a  director  of  the  Foundation.    Prieto,  a
minority shareholder and president of Synergy, is a director of the Foundation
and was an officer until 2017.  The Foundation’s three other currently listed
officers and directors are owners or employees of Synergy.
29. The  Foundation’s  by-laws  state  that  “the  specific  purposes  for
which  the  Corporation  is  formed  is  to  assist  personal  injury  victims  with
special needs, either directly or indirectly.”  Its articles of incorporation list the
identical  purpose  for  which  the  Foundation  was  formed.    Furthermore,  the

10 
Foundation’s  articles  of  incorporation  state  that  “the  Corporation  shall  not
allow any part of the net earnings of the Corporation to inure to the benefit or
be  distributable  to  any  private  person,  member,  director  or  officer  of  the
Corporation . . .”
30. Shortly  after  its  incorporation,  in  August  2012,  the  Foundation
applied to the IRS for non-profit, tax-exempt status under Section 501(c)(3) of
the  Internal  Revenue  Code.    Lazarus  signed  the  application  as  director  and
president  of  the  Foundation.    In  the  section  of  the  application  entitled
“Narrative Description of Your Activities” the Foundation reiterated:
The  specific  purpose  for  which  the  Foundation  was  formed  is  to  provide:
(i)   personal   injury   victims   with   special   needs,   through   individual   grants,
supplemental  assistance  needed  to  obtain  the   care   and   services   necessary   for
recovery/rehabilitation/education,  helping  to  alleviate  financial  difficulties  and  (ii)
funding  of  501(c)(3)  non-profit  organizations  operating specifically in the areas of
providing  personal injury victims with special needs, assistance to obtain the care
and services necessary for recovery/rehabilitation/education.

31.
The   application   further   described   what   organizations   the
Foundation would donate money to and the process by which the corporation
would decide on its donations:
Foundation  Directors  will  research  potential  recipients,  the  personal  injury
suffered and the special needs of each.

The  Foundation  plans  to  provide  recipients  with  supplemental  assistance  to
obtain  the  care  and  services  necessary  for  recovery/rehabilitation/education
helping to alleviate financial difficulties.

Foundation  Directors  will  research  potential  recipient  501(c)(3)  non-profit
organizations  operating  specifically  in  the  areas  of  providing  personal  injury

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victims with special needs, assistance to obtain the care and services necessary
for recovery/rehabilitation/education . . . .

The Foundation will be providing assistance to (i) personal injury victims with
special needs and (ii) 501(c)(3) non-profit organizations operating specifically in
the areas of providing personal injury victims with special needs, assistance to
obtain the care and services necessary for recovery/rehabilitation/education.

32. The  application  also  stated  that  the  Foundation:  (i)  had  no
arrangements  with  related  entities;  (ii)  followed  a  conflict-of-interest  policy,
including  consideration  of  alternative  service  providers;  and  (iii)  had  no
revenue-sharing joint ventures.
33. Based on these representations, the IRS granted the Foundation
501(c)(3) status, a decision the SSA relied on in accepting the Foundation as a
valid  non-profit  association  that  purportedly  operated  and  managed  SSNPT
under  Section  1396p.    During  the  SSA’s  review  of  SSNPT’s  master  trust
agreement in 2016, Synergy represented that SSNPT operated in accordance
with  the  terms  of  the  agreement  –  that  the  Foundation  was  a  legitimate
501(c)(3) entity and managed SSNPT as trustee.
34. Foundation became the SSNPT trustee in 2015.  On May 15, 2015,
Prieto  signed  the  master  trust  agreement  for  SSNPT  on  behalf  of  the
Foundation as the named trustee.  Prieto signed subsequent amendments to
the  SSNPT  master  trust  agreement  in  March  2016  and  December  2016  on
behalf  of  the  Foundation.    Similarly,  on  March  16,  2016,  Prieto  signed  the
master trust agreement for SMNPT on behalf of the Foundation as the named

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trustee.
35. Both    the    SSNPT    and    SMNPT    master    trust    agreements
represented that the Foundation was the trustee and is a “501(c)(3) non-profit
corporation,”  and  that  the  pooled  trust  property  “is  to  be  administered  and
distributed by” the Foundation.
C.  Marketing, Selling, And Operating The Trusts
36. Synergy  is  a  for-profit  company  that  offers  a  host  of  structured
financial products, including SSNPT and SNMPT.  Synergy’s main source of
business is personal injury trial lawyers whose clients frequently are disabled,
minors,  and/or  have  guardians,  and  who  receive  funds  from  personal  injury
and other legal proceedings.  Synergy, largely through Lazarus and The Law
Firm, aggressively markets SSNPT and SNMPT to these lawyers.
37. To that end, Synergy, Lazarus, and the Law Firm send a variety
of  marketing  and  other  documents  containing  information  about  the  trusts.
Among  these  documents  are  a  joinder  agreement  that  each  beneficiary
enrolling in a trust must sign, in which they acknowledge and adopt the trust’s
master trust agreement and agree that they are placing assets irrevocably into
the trust they are joining.  There are also marketing brochures describing the
benefits  of  joining  a  trust  (i.e.,  retaining  Medicaid  and  SSI  benefits),  uses  of
and  limitations  on  the  trusts  (such  as  how  and  for  what  types  of  expenses

13 
beneficiaries can receive distributions); what happens to any remaining funds
in  the  trusts  upon  the  death  of  a  beneficiary;  and  purported  options  for
investing funds in the trusts.
38. When   recruiting   new   beneficiaries   for   SSNPT   and   SMNPT,
Lazarus  cross-sells  the  legal  services  of  the  Law  Firm  to  represent  the
beneficiaries in joining the trusts.  The Law Firm charges each client $1,500
for  its  services  in  helping  them  join  SSNPT  and  SMNPT.      The  Law  Firm’s
invoice  for  the  $1,500  fee  describes  the  legal  representation  as  “regarding
establishment  of  pooled  settlement  trust,”  including  “all  consultations  and
communications  regarding  the  Trust  [and]  preparation  and  drafting  of  the
Trust.”
39. In  2015,  Synergy  signed  an  agreement  with  an  unaffiliated  for-
profit  firm,  National  Trust  and  Fiduciary  Services  Company,  Inc.,  d/b/a
Eastern Point Trust Company (“EPT”) to act as the administrator for SSNPT
and SMNPT.  In practice, Lazarus, Prieto, and Synergy delegated almost all
authority over the trust administration to EPT.  EPT developed several model
investment  portfolios  for  beneficiaries  and  handled  all  aspects  of  investing
trust assets in securities.  In addition, Lazarus, Prieto, and Synergy delegated
the sole discretion to respond to and approve or deny distribution requests from
beneficiaries.  EPT only conferred with Synergy (through Lazarus, Prieto, and

14 
other Synergy employees) on a handful of distribution requests which, in EPT’s
judgment, required further consideration.
40. In 2017, Synergy and EPT terminated their relationship.  Synergy
then  found  another  unaffiliated  for-profit  investment  adviser,  True  Link
Financial  Advisors,  LLC,  to  handle  the  investment  and  asset  management
functions  for  both  SSNPT  and  SMNPT.    Since  2017,  Synergy  has  controlled
beneficiary distributions and other day-to-day decisions involving SSNPT and
SMNPT, while True Link has handled the investment of trust assets.
41. In addition to the $1,500 fee to the Law Firm, beneficiaries pay a
$500 or $550 “joinder fee” (the amount has varied over time).  A portion of that
fee  has  gone  to  either  EPT  or  True  Link,  and  the  remainder  has  gone  to
Synergy, even though the Defendants represent that the Foundation charges
the joinder fee.  Also as described in more detail below, beneficiaries have paid
an annual trustee fee of either one percent (when EPT was the administrator)
or  .75  percent  (when  True  Link  was  the  administrator)  of  the  value  of  the
assets in their sub-account.  The administrator deducts the fee directly from
each sub-account and sends it to Synergy.  From 2015 through 2019, Synergy
earned in excess of $675,000 from trustee fees, and has earned more since then.
Synergy has earned more than $100,000 from the joinder fee.
42. The Defendants offer and sell the pooled trusts to beneficiaries as

15 
investment contracts.  Beneficiaries are provided membership in the trusts in
exchange  for  them  transferring  funds  from  their  monetary  settlements  or
awards irrevocably into the trusts.  As allowed under Section 1396p, the trusts
pool  investor  funds  together  for  investment  purposes.    The  success  of  the
investments  depends  on  the  efforts  of  the  Defendants  and  their  chosen
investment advisers.  Once they join the trusts and select an investment model
developed by the Defendants and their investment advisers, the beneficiaries
have no involvement in the investment of their funds.
43. Although  beneficiaries  have  sought to join SSNPT in part to
preserve  their  Medicaid  and  SSI  benefits,  the  Defendants  also  market  the
trusts  in  brochures  as  “getting  more  than  just  protection  of  public  benefits.”
They  promise  beneficiaries  advantages  “including  high  quality  investment
management services” and “better interest rates.”  The Defendants also claim
the  trusts  are  superior  to  other  pooled  trusts  because  “the  sub-accounts  are
actively managed by professional money managers,” which “allows for a higher
rate of return than would be possible if funds were invested separately . . . The
sub-account  funds,  like  other  investments  .  .  .  may  lose  value.    There  is  no
guarantee  that  the  money  will  grow  or  be  secure.”    Lawyers  for  potential
beneficiaries have frequently asked Lazarus and Prieto how the funds will be
invested or if they will earn interest.

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44. No registration statement has been in effect for the pooled trusts
during  the  time  of  the  events  set  forth  in  this  Complaint.    Furthermore,  no
exemptions   from   registration   are   available,   including   exemptions   for
charitable  organizations  under  the  Securities  Act,  the  Exchange  Act,  the
Advisers Act, and the Investment Company Act.
D.  The Defendants’ Misrepresentations And Omissions
1.  The Defendants Misrepresent That The Foundation Manages The Trusts
45. Lazarus,  Prieto,  and  Synergy,  in  marketing  materials,  trust
documents, emails, letters, websites, and elsewhere, repeatedly have stated to
potential beneficiaries they should join SSNPT because it is a Section 1396p
trust established and managed by a non-profit association - the Foundation.
46. For  example,  in  November  2015,  Lazarus  gave  a  presentation
touting  “How  is  the  SSNPT  different  from  other  pooled  trusts?”  with  such
details as “Foundation...is Non-Profit Trustee” and “Lowest fees nationally” of
just  $550  at  inception  and  “Annual  trustee  fee  –  1%  of  assets  held  in  trust”
(emphasis in original).
47. In another example, Lazarus directed a March 2018 Synergy blog
post stating a pooled settlement trust “is managed by a non-profit entity who
created it and acts as trustee.  As a result of this arrangement, it is a low-cost
way for a client to set up a trust for their benefit. . . . The trustee of the SMNPT

17 
is the Foundation for Those with Special Needs a 501(c)(3) non-profit created
specifically to act as trustee for trusts such as this.”
48. In  an  email  dated  May  17,  2018,  Lazarus  told  a  prospective
beneficiary: “I am not the trustee.  Under Federal Law, the trustee must be a
non-profit.  In this case it is the Foundation.”   Also, by email dated October 1,
2018, Lazarus told a prospective beneficiary that SSNPT “is administered by
a non-profit called the Foundation.”
49. Prieto made similar statements.  On April 19, 2018, he presented
a  webinar  stating  special  needs  pooled  trusts  must  be  “managed  by  Not  for
Profit Trustee pursuant to federal law,” with SSNPT and SMNPT identified as
“available  trust  solutions.”    By  email  dated  August  23,  2018,  Prieto  told  a
representative  of  a  prospective  beneficiary  “The  Trustee  [of  SSNPT]  is  The
Foundation for Those with Special Needs, Inc.”
50. Additionally,  SSNPT’s  website  has  stated:  “Under  federal  law,  a
pooled  special  needs  trust  must  be  created  and  managed  by  a  non-profit
trustee.  SSNPT is managed by [Foundation] who acts as the trustee. . . .  While
this is a difficult reality to face, turning your settlement over to a trustee of a
special needs trust, it is what is required by federal/state law to remain eligible
for needs based benefits.”
51. In  their  retainer  letter,  the  Law  Firm  and  Lazarus  assure

18 
beneficiaries that “[t]he creation of a pooled trust sub-account will insure that
[their] settlement proceeds will not be treated as a countable asset for purposes
of qualifying for Medicaid and/or SSI,” and that the Law Firm would “adhere
to proper and approved special needs trust structure and format.”  In an email
dated April 11, 2017, Lazarus, in his capacity at the Law Firm, pressured the
mother of a prospective beneficiary: “The purpose of the trust is [to] preserve
Medicaid eligibility.  Without the trust, your daughter would lose coverage. . .
.  Of course you can decide not to set up the trust and lose Medicaid until the
money is completely gone.”
52. Finally,  the  Defendants  consistently  represent  to  beneficiaries
that the trustee and joinder fees described above are paid to the Foundation as
the trustee.  For example, the Administrative Services Agreements that both
EPT and True Link signed that included provisions for deducting and paying
the  trustee  fees  were  with  the  Foundation,  not  Synergy.    Additionally,  a
Welcome Kit that beneficiaries receive upon joining states that the trustee –
the Foundation – charges the joinder and annual fees.
53. All of these representations are false.  The Foundation is a shell
company  with  no  employees,  operations,  or  even  a  single  email  address.
Rather,  Lazarus  and  Prieto  have  Synergy  employees  perform  all  work  in
connection with SSNPT or SMNPT – or perform it themselves – without any

19 
written  agreements  with  the  Foundation  or  invoices  to  the  Foundation
regarding  any  such  work.    Lazarus  and  Prieto  respond  to  all  inquiries  from
beneficiaries about trust operations.  Other Synergy employees have answered
calls from beneficiaries, as well as exchanged emails with True Link regarding
investment of the trust assets.
54. Synergy:  induces  beneficiaries  to  join  the  SSNPT  and  SMNPT
based in part on promised investment performance; has had discussions with
individual  beneficiaries  about  investment  options;  and  has  the  authority  to
invest  each  beneficiary’s  funds.    Lazarus  advises  beneficiaries  on  acquiring
interests  in  SSNPT  and  SMNPT.    Prieto  has  advised  some  beneficiaries  on
investments, approved the portfolios by which SSNPT and SMNPT assets were
invested,  and  primarily  handled  the  reinvestment  of  SSNPT  and  SMNPT
assets during the transition from EPT to True Link.
55. Furthermore, the trustee fees purportedly paid to the Foundation
under the Administrative Services Agreements are, in reality, paid directly to
Synergy as part of its for-profit control of SSNPT and SMNPT.  To attempt to
justify receiving the trustee fees, Synergy entered into sham agreements with
EPT  and  True  Link  pursuant  to  which  each  firm  was  supposed  to  pay  a
marketing  fee  to  Synergy  for  purportedly  marketing  EPT  or  True  Link’s
services.  The alleged marketing fee in both cases has been equal to the trustee

20 
fee under the Administrative Service Agreements.
56. In reality, Synergy has done little or no marketing of either EPT
or True Link’s services.  For example, the only “marketing” Synergy has done
for True Link is to mention in Synergy’s brochures marketing the trusts to trial
lawyers that True Link is the investment advisor, and to include True Link’s
own  previously  prepared  firm  descriptions  in  the  brochures.    Furthermore,
there  is  no  separate  marketing  fee  –  both  EPT  and  True  Link  paid  only  the
trustee fee to Synergy.  The marketing agreement was merely a ruse to attempt
to hide the fact that Synergy, not the Foundation, has received all trustee fees.
57. Lazarus confirmed the bogus nature of the marketing fee by email
dated June 4, 2014, telling an EPT representative that Synergy “would get the
trustee fee at inception, which would be collected by [EPT] and then paid over
to Synergy as some sort of marketing arm or something like that.”  Synergy’s
internal  strategic  plans  also  tout  the  trustee  fees  as  “significant  recurring
revenue”  every  year  over  the  lifetime  of  the  beneficiaries  of  SSNPT  and
SMNPT.
58. To maintain the façade that SSNPT and SMNPT have a non-profit
trustee, Lazarus and Prieto specifically told Synergy employees not to mention
Synergy when marketing SSNPT and SMNPT.  Lazarus instructed a Synergy
employee in a June 1, 2018 email: “Synergy is the marketing arm for the pooled

21 
trusts but isn’t involved corporately with the trusts (if that makes sense).  The
only corporate entity related to the trusts is the Foundation.”
59. Five days later, Lazarus told True Link in an email to “make sure
that  we  never  reference  Synergy  on  any  of  the  pieces  for  the  pooled  trust.
Synergy is the marketing arm for the trusts but that is it.” In a February 6,
2018 email, Prieto told Lazarus that Synergy’s name should be removed from
account statements the trusts sent to SSNPT and SMNPT beneficiaries.
2.  The Defendants Make Misrepresentations About Pooled Trust Fees
60. While  EPT  was  trust  administrator,  the  Defendants  invested
beneficiaries’  funds  in  one  of  seven  portfolios  comprised  of  the  same  set  of
equity  and  fixed-income  mutual  funds  (with  varying  percentages  to  reflect
different risk tolerance levels), and a money market balance of 0 to 14 percent.
61. All the mutual fund positions were in a particular class of mutual
fund shares: Class C shares.  Class C shares carry the highest of certain kinds
of  fees  payable  to  broker-dealers  to  cover  fund  distribution  and  shareholder
service expenses known as 12b-1 Fees.  These recurring fees, which are included
in  a  mutual  fund’s  total  annual  fund  operating  expenses,  are  approximately
one  percent  per  year  and  are  deducted  from  the  mutual  fund’s  assets  on  an
ongoing basis.  As a result, 12b-1 Fees are paid by investors in Class C shares.
62. Therefore,  from  2015  to  2017,  the  beneficiaries  of  SSNPT  and

22 
SMNPT each year paid approximately one percent of their total assets in fees
due to the Defendants investing their funds in Class C shares.  At the time,
EPT wholly owned a registered broker-dealer that collected 12b-1 Fees on the
Class  C  share  holdings  and  sent  them  (net  of  expenses)  to  EPT  as  its
compensation for acting as trust administrator for SSNPT and SMNPT.
63. Prieto and Lazarus knew EPT would be compensated for its role
as administrator for the two trusts solely from 12b-1 Fees on Class C shares.
In a May 19, 2014 email discussing EPT becoming trust administrator, EPT
wrote that its proposal would allow for “lower public trustee fees” by using the
fees from their proposed investment portfolios (all of which were comprised of
Class C shares) as compensation to EPT.  Furthermore, on January 10, 2017,
Prieto  acknowledged  EPT  was  being  paid  through  12b-1  Fees:    “[EPT]  is
earning roughly 1% from the funds they use. . . .  The end client is not seeing
the fee it is [embedded] into the expense of the funds.”
64. Lazarus, Prieto, and Synergy did not disclose to beneficiaries that
they  were,  in  effect,  paying  the  12b-1  Fees  to  EPT.    In  June  2015,  the
Defendants reviewed and approved a notice sent to beneficiaries stating “some
of  the  many  resulting  benefits  of  [EPT]  being  the  administrator  are  cost
reductions  for  annual  fees  and  a  wider  array  of  investment  options.    The
annual fee will drop from 2% down to 1%.”  Thus, the Defendants only told the

23 
beneficiaries they were paying a trustee fee of one percent and a $500 joinder
fee – with no mention of the additional one percent 12b-1 Fees.  Nor did the
Defendants  provide  beneficiaries  with  prospectuses  for  the  mutual  funds  or
other fee or class-specific disclosures.
3.  The Defendants Misrepresent Their Use of Retained Funds
65. Section  1396p  refers  indirectly  to  funds  in  a  beneficiary’s  sub-
account  being  “retained  by  the  trust”  upon  the  death  of  a  beneficiary,  but  is
silent on the circumstances under which a pooled trust may retain those funds
and  the  uses  to  which  the  trust  may  put  those  retained  funds.    However,
Internal Revenue Code Section 501(c)(3) specifies that non-profits granted tax-
exempt  status  must  generally  use  their  funds  for  charitable  purposes  or  the
express purposes for which the entity was created.
66. As  noted  above,  in  its  501(c)(3)  application,  the  Foundation
expressly represented to the IRS on multiple occasions that its specific purpose
is to assist personal injury victims with special needs, and that it would fund
“non-profit  organizations  operating  specifically  in  the  areas  of  providing
personal  injury  victims  with  special  needs.”    Both  the  Foundation’s  by-laws
and articles of incorporation contain similar descriptions of its purpose.
67. In  addition,  Synergy,  Lazarus,  and  Prieto  have  represented  in
numerous  documents  sent  to  actual  and  prospective  beneficiaries  that  they

24 
would  use  a  beneficiary’s  retained  funds  expressly  to  further  the  trusts’
mission   of   serving   people   with   disabilities.      For   example,   the   joinder
agreements  beneficiaries  sign  to  join  the  trusts  allow  beneficiaries  to  choose
among  several  options  of  what  will  happen  to  any  funds  still  in  their  sub-
accounts when they die.  Among the options is allowing the trust to retain the
funds, in which case the joinder agreement states the trust will use the funds
“to  help  the  Settlement  Solutions  National  Pooled  Trust  with  its  important
non-profit mission of serving individuals with disabilities.”
68. Similarly,  letters  Lazarus  writes  to  lawyers  for  beneficiaries
considering joining one of the trusts attach a client intake form, which includes
several  options  for  funds  remaining  in  a  sub-account.    The  “retained  funds
option” states: “if money is left in the sub-account when the trust Beneficiary
passes  away  then  the  funds  shall  be  retained  by  the  Trust  to  help  the
Settlement  Solutions  National  Pooled  Trust  with  its  important  non-profit
mission of serving individuals with disabilities.”
69. The  Welcome  Kit  the  Defendants  send  to  new  beneficiaries
includes   a   “Schedule   C   –   Authorized   Representative   and   Remainder
Beneficiary  Designation.”    The  “Retained  By  Trust”  option  has  identical
language to the client intake form attached to Lazarus’ letters.
70. Lazarus sent an email to colleagues at Synergy on May 18, 2016,

25 
attaching  a  proposed  marketing  brochure  to  send  to  trial  lawyers.    The
brochure  states  in  relevant  part  that  “SSNPT  was  created  for  the  singular
purpose  of  assisting  injury  victims  to  remain  eligible  for  needs-based  public
assistance benefits,” and “our trust makes it possible for remaining assets to
be returned to the family at death in certain situations, or remain in the trust
for the benefit of other persons with disabilities.”
71. Although  a  one-page  information  sheet  about  both  SSNPT  and
SNMPT  the  Defendants  sent  to  some  potential  beneficiaries  states  that  the
Foundation was created both to assist people with disabilities and to give back
to the civil justice system, this representation directly contradicts statements
in  the  Foundation’s  501(c)(3)  application,  articles  of  incorporation,  by-laws,
and numerous other trust documents the Defendants sent to beneficiaries.
72. Contrary  to  their  representations,  Lazarus,  Prieto,  and  Synergy
have  not  used  a  significant  portion  of  retained  funds  to  help  the  disabled  or
other people with special needs.  Instead, Synergy has diverted all of the funds
from the SSNPT operating account to a separate bank account in the name of
the  Foundation,  from  where  Lazarus  and  Prieto  have  used  funds  largely  to
further their own, for-profit interests.
73. Since August 2018, Synergy has used at least $132,000 to pay trust
administrative expenses, when it already collected the one percent trustee fee

26 
purportedly  to  pay  those  same  expenses.    Synergy  financial  statements
indicate  that  since  2015  the  annual  trustee  fee  has  exceeded  the  trusts’
administrative  expenses  –  leaving  no  need  for  use  of  retained  funds  to  pay
those expenses.  Synergy’s use of retained funds to purportedly cover expenses,
while also collecting the one percent trustee fee, did not reduce the amounts
charged to beneficiaries for administrative costs.
74. The  Defendants  also  used  retained  funds  to  pay  administrative
expenses  that  had  nothing  to  do  with  the  trusts.    For  example,  they  used
retained funds to pay the premiums on a Synergy business insurance policy.
75. In addition, Synergy has spent at least $300,000 on donations to
trial lawyers’ organizations or charities of which the Defendants are a member
or have friends and acquaintances who serve in important positions in them
that have nothing to do with assisting disabled persons.  Some organizations
were not even 501(c)(3) non-profits.  Numerous emails among Lazarus, Prieto
and their Synergy partners make it clear that the main criteria for choosing
recipients  of  the  beneficiaries’  retained  funds  was  to  promote  Synergy’s  for-
profit  business  interests.    Among  the  recipients  of  Synergy’s  largesse  with
retained funds have been golf tournaments, beach parties, and a holiday party
organized  by  legal  friends,  clients,  and  acquaintances  of  Lazarus  and  his
Synergy partners.

27 
76. Lazarus   and   Prieto   have   confirmed   the   purpose   of   these
disbursements  of  retained  funds  in  internal  emails.    For  example,  Lazarus
wrote in a December 10, 2015 email that Synergy should sponsor an event at
the request of a fellow lawyer because “this is targeted to the legal community
so it does give us good bang for the buck.”  In another instance, Prieto agreed
to contribute $1,000 to a golf tournament organized by a lawyer who another
Synergy  lawyer  described  as  “my  best  client”  who  had  recently  arranged  for
money to be spent on Synergy financial products.
77. Other examples include:
a. In June 2015, Synergy used retained funds to pay $15,000 to a group
of trial lawyers who had achieved large settlements.  In March 2015,
Lazarus had sent the group’s founder, a client of Lazarus, a proposal
for an “exclusive annual sponsorship” by which Synergy could attend
group social events, provide webinars, and be recognized as a sponsor
in membership emails and “business partner” on the group’s website.
Soon  after  Synergy’s  $15,000  payment,  in  November  2015,  Prieto
prepared a presentation for Lazarus to make to that group about all
of  Synergy’s  lines  of  business  titled  “Synergy  Settlement  Services:
Allowing Trial Lawyers to Focus on What They Do Best.”
b. In January 2016, Synergy used retained funds to pay the professional

28 
dues for Synergy employees to be named as sponsoring fellows of a
think tank created by trial lawyers.
c. From  2015  through  2018,  Synergy  used  retained  funds  to  pay  for  a
named sponsorship at a holiday event for the lawyer alumni group of
a private high school in Tampa.  Synergy made the payments at the
request of a lawyer who frequently refers business to Synergy.
d. In June 2015, June 2016 and July 2017, Synergy used retained funds
to pay for a named sponsorship at judicial luncheons hosted by a legal
mentoring organization for worker’s compensation lawyers.
e. In  August  2015,  July  2016  and  July  2017,  Synergy  used  retained
funds to pay for a named sponsorship at a beach party held by a trial
lawyer association unrelated to the disabled community.
f. In  November  2015,  Synergy  sponsored  a  project  involving  a  trial
lawyer  for  construction  activities  in  a  Berber  village  in  Morocco
unrelated to the disabled community.

V.  VIOLATIONS ALLEGED

COUNT I
Violations of Section 17(a)(1) of the Securities Act
(Against All Defendants)
78. The Commission repeats and realleges Paragraphs 1 through 77 of

29 
its Complaint as if incorporated herein.
79. From  no  later  than  May  2015  to  the  present,  the  Defendants,  in
the offer or sale of any securities by the use of any means or instruments of
transportation or communication in interstate commerce or by use of the mails,
directly or indirectly, knowingly or severely recklessly, employed any device,
scheme or artifice to defraud.
80. By  reason  of  the  foregoing,  the  Defendants  violated,  and,  unless
enjoined,  are  reasonably  likely  to  continue  to  violate,  Section  17(a)(1)  of  the
Securities Act, 15 U.S.C. § 77q(a)(1).
COUNT II
Violations of Section 17(a)(2) of the Securities Act
(Against All Defendants)
81. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
82. From no later than May 2015 through the present, the Defendants,
in the offer or sale of any securities by the use of any means or instruments of
transportation or communication in interstate commerce or by use of the mails,
directly  or  indirectly,  negligently  obtained  money  or  property  by  means  of
untrue  statements  of  material  facts  or  omissions  to  state  material  facts
necessary to make the statements made, in light of the circumstances under

30 
which they were made, not misleading.
83. By  reason  of  the  foregoing,  the  Defendants  violated,  and,  unless
enjoined,  are  reasonably  likely  to  continue  to  violate,  Section  17(a)(2)  of  the
Securities Act, 15 U.S.C. § 77q(a)(2).
COUNT III
Violations of Section 17(a)(3) of the Securities Act
(Against All Defendants)
84. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
85. From no later than May 2015 through the present, the Defendants,
in the offer or sale of any securities by the use of any means or instruments of
transportation or communication in interstate commerce or by use of the mails,
directly  or  indirectly,  negligently  engaged  in  transactions,  practices  and
courses of business which operated or would have operated as a fraud or deceit
upon the purchasers and prospective purchasers of such securities.
86. By  reason  of  the  foregoing,  the  Defendants  violated,  and,  unless
enjoined,  are  reasonably  likely  to  continue  to  violate,  Section  17(a)(3)  of  the
Securities Act, 15 U.S.C. § 77q(a)(3).

31 
COUNT IV

Violations of Section 10(b) and Rule 10b-5(a) of the Exchange Act
(Against All Defendants)
87. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
88. From no later than May 2015 through the present, the Defendants,
directly  and  indirectly,  by  use  of  any  means  or  instrumentality  of  interstate
commerce,  or  of  the  mails,  knowingly  or  severely  recklessly  employed  any
device, scheme or artifice to defraud in connection with the purchase or sale of
any security.
89. By  reason  of  the  foregoing,  the  Defendants  violated,  and,  unless
enjoined, are reasonably likely to continue to violate, Section 10(b) and Rule
10b-5(a) of the Exchange Act, 15 U.S.C. § 78j(b), and 17 C.F.R. § 240.10b-5(a).
COUNT V
Violations of Section 10(b) and Rule 10b-5(b) of the Exchange Act
(Against All Defendants)
90. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
91. From no later than May 2015 through the present, the Defendants,
directly  and  indirectly,  by  use  of  any  means  or  instrumentality  of  interstate

32 
commerce,  or  of  the  mails,  knowingly  or  severely  recklessly  made  untrue
statements of material facts and omitted to state material facts necessary in
order to make the statements made, in light of the circumstances under which
they were made, not misleading in connection with the purchase or sale of any
security.
92. By  reason  of  the  foregoing,  the  Defendants  violated,  and,  unless
enjoined, are reasonably likely to continue to violate, Section 10(b) and Rule
10b-5(b) of the Exchange Act, 15 U.S.C. § 78j(b), and 17 C.F.R. § 240.10b-5(b).
COUNT VI
Violations of Section 10(b) and Rule 10b-5(c) of the Exchange Act
(Against All Defendants)
93. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
94. From no later than May 2015 through the present, the Defendants,
directly  and  indirectly,  by  use  of  any  means  or  instrumentality  of  interstate
commerce,  or  of  the  mails,  knowingly  or  severely  recklessly  engaged  in  acts,
practices and courses of business which operated or would have operated as a
fraud or deceit upon any person in connection with the purchase or sale of any
security.
95. By  reason  of  the  foregoing,  the  Defendants  violated,  and,  unless

33 
enjoined, are reasonably likely to continue to violate, Section 10(b) and Rule
10b-5(c) of the Exchange Act, 15 U.S.C. § 78j(b), and 17 C.F.R. § 240.10b-5(c).
COUNT VII
Violations of Sections 5(a) and 5(c) of the Securities Act
(Against Synergy, Lazarus, and Prieto)
96. The Commission repeats and realleges Paragraphs 1 through 64 of
its Complaint as if incorporated herein.
97. From  no  later  than  May  2015  through  the  present,  Synergy,
Lazarus  and  Prieto,  directly  or  indirectly,  have  made  use  of  the  means  or
instruments of transportation or communication in interstate commerce or of
the mails to sell securities, when no registration statement was in effect with
the  Commission  as  to  such  securities,  and  have  made  use  of  the  means  or
instruments of transportation or communication in interstate commerce or of
the  mails  to  offer  to  sell  such  securities  when  no  registration  statement  had
been filed with the Commission as to such securities.
98. There were no applicable exemptions from registration.
99. By reason of the foregoing, Synergy, Lazarus and Prieto violated,
and, unless enjoined, are reasonably likely to continue to vi
olate, Sections 5(a)
and 5(c) of the
 Securities Act, 15 U.S.C. § 77e(a), (c).

34 
COUNT VIII
Violations of Section 206(1) of the Advisers Act
(Against Synergy, Lazarus, and Prieto)
100. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
101. From  no  later  than  May  2015  through  the  present,  Synergy,
Lazarus  and  Prieto,  by  engaging  in  the  conduct  set  forth  above,  directly  or
indirectly,  knowingly  or  severely  recklessly,  through  use  of  the  mails  or  the
means or instrumentalities of interstate commerce, and while engaged in the
business of advising others for compensation as to the advisability of investing
in, purchasing, or selling securities, employed devices, schemes, or artifices to
defraud.
102. By reason of the foregoing, Synergy, Lazarus and Prieto violated,
and, unless enjoined, are reasonably likely to continue to violate, Section 206(1)
of the Advisers Act, 15 U.S.C. § 80b-6(1).
COUNT IX

Violations of Section 206(2) of the Advisers Act
(Against Synergy, Lazarus, and Prieto)
103. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.

35 
104. From  no  later  than  May  2015  through  the  present,  Synergy,
Lazarus  and  Prieto,  by  engaging  in  the  conduct  set  forth  above,  directly  or
indirectly,  knowingly  or  severely  recklessly,  through  use  of  the  mails  or  the
means or instrumentalities of interstate commerce, and while engaged in the
business of advising others for compensation as to the advisability of investing
in,  purchasing,  or  selling  securities,  engaged  in  acts,  practices,  or  courses  of
business which operated or would operate as a fraud or deceit upon clients or
prospective clients.
105. By reason of the foregoing, Synergy, Lazarus and Prieto violated,
and, unless enjoined, are reasonably likely to continue to violate, Section 206(2)
of the Advisers Act, 15 U.S.C. § 80b-6(2).
COUNT X
Violations of Section 206(4) and Rule 206(4)-8 of the Advisers Act
(Against Synergy, Lazarus, and Prieto)
106. The Commission repeats and realleges Paragraphs 1 through 77 of
its Complaint as if incorporated herein.
107. From  no  later  than  May  2015  through  the  present,  Synergy,
Lazarus and Prieto each acted as investment advisers, as defined by Section
202(a)(11) of the Advisers Act, 15 U.S.C. § 80b-2(a)(11), to SSNPT and SMNPT
and their beneficiaries.

36 
108.   At all relevant times, SSNPT and SMNPT operated as a pooled
investment vehicle, as defined by Rule 206(4)-8(b) under the Advisers Act, 17
C.F.R. § 275.206(4)-8(b).
109. Synergy, Lazarus and Prieto, by engaging in the acts and conduct
alleged  above,  while  acting  as  investment  advisers  to  a  pooled  investment
vehicle, by use of the means and instrumentalities of interstate commerce and
of the mails, made untrue statements of a material fact or omitted to state a
material  fact  necessary  to  make  the  statements  made,  in  the  light  of  the
circumstances under which they were made, not misleading, to any investor or
prospective  investor  in  SSNPT  and  SMNPT,  and  otherwise  engaged  in  acts,
practices   or   courses   of   business   that   were   fraudulent,   deceptive,   or
manipulative  with  respect  to  any  investor  or  prospective  investor  in  SSNPT
and SMNPT.
110. By reason of the foregoing, Synergy, Lazarus and Prieto violated,
and, unless enjoined, are reasonably likely to continue to violate, Section 206(4)
of  the  Advisers  Act,  15  U.S.C.  §  80b-6(4),  and  Rule  206(4)-8  thereunder,  17
C.F.R. § 275.206(4)-8.
VI.  RELIEF REQUESTED
WHEREFORE,  the  Commission  respectfully  requests  the  Court  find
the Defendants committed the violations alleged, and:

37 
A.
Permanent Injunction
Issue a Permanent Injunction restraining and enjoining the Defendants,
their officers, agents, servants, employees, attorneys, and all persons in active
concert or participation with them, and each of them, from violating the federal
securities laws alleged in this Complaint.
B.
Disgorgement
Issue an Order directing the Defendants to disgorge all ill-gotten gains,
including prejudgment interest, resulting from the acts or courses of conduct
alleged in this Complaint.
C.
Penalties
Issue an Order directing Synergy, Special Needs Law Firm, Lazarus and
Prieto to pay civil money penalties pursuant to Section 20(d) of the Securities
Act, 15 U.S.C. § 77t(d), Section 21(d) of the Exchange Act, 15 U.S.C. § 78u(d),
and Section 209(e) of the Advisers Act, 15 U.S.C. § 80b-9(e).
D.
Further Relief
Grant such other and further relief as may be necessary and appropriate.

38 
E.
Retention of Jurisdiction
Further,  the  Commission  respectfully  requests  that  the  Court  retain
jurisdiction  over  this  action  and  over  the  Defendants  in  order  to  implement
and carry out the terms of all orders and decrees that may hereby be entered,
or  to  entertain  any  suitable  application  or  motion  by  the  Commission  for
additional relief within the jurisdiction of this Court.
VII.  JURY TRIAL DEMAND

The Commission demands a trial by jury on all issues so triable.

Dated: May 2, 2022   By:    s/Robert K. Levenson
       Robert K. Levenson
       Senior Trial Counsel
                                                                      Fla.          Bar          No.          0089771
                                                                      Telephone:          (305)          982-6341
                                                                      Facsimile:          (305)          536-4154
       E-mail:  [email protected]

       Alice Sum
       Trial Counsel
                                                                      Fla.          Bar          No.          354510
                                                                      Telephone:          (305)          416-6293
                                                                      Facsimile:          (305)          536-4154
       E-mail:  [email protected]

A
TTORNEYS FOR PLAINTIFF
S
ECURITIES AND EXCHANGE
COMMISSION
801 Brickell Avenue, Suite 1950
                                        Miami,     Florida     33131

UNITED STATES DISTRICT COURT 
FOR THE MIDDLE DISTRICT OF FLORIDA 

 
ORLANDO DIVISION 

 
CASE NO. ____________ 

 
SECURITIES AND EXCHANGE COMMISSION,  
          
   Plaintiff,     
v.         
         
SYNERGY SETTLEMENT SERVICES, INC.,   
FOUNDATION FOR THOSE WITH SPECIAL   
NEEDS INC.,        
SPECIAL NEEDS LAW FIRM PLLC,    
JASON D. LAZARUS, and     
ANTHONY F. PRIETO, JR.    
        

Defendants.   
_________________________________________________/ 
  

COMPLAINT AND DEMAND FOR JURY TRIAL 

Plaintiff Securities and Exchange Commission alleges: 

I.  INTRODUCTION 

1. The Commission brings this action to enjoin the Defendants’ 

fraudulent operation of two purportedly charitable pooled investment trusts 

with $46 million in assets and more than 380 trust members, most of whom 

are disabled recipients of Medicaid or Social Security Supplemental Security 

Income (“SSI”) benefits.   

2. Section 1917 of the Social Security Act, 42 U.S.C. § 1396p, allows 

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Medicaid and SSI recipients to remain eligible for benefits despite receiving 

assets (such as awards or settlements in personal injury lawsuits) that would 

otherwise disqualify them from receiving that government assistance, as long 

as they place those assets in an irrevocable trust established and managed by 

a non-profit association. 

3. From no later than May 2015 through the present, the Defendants 

have marketed, sold investments in, and operated two pooled investment 

trusts purportedly established and managed by a non-profit entity as required 

by Section 1396p.  In reality, however, the entity named as the trustee of the 

two trusts, Defendant Foundation for Those with Special Needs, Inc., 

(“Foundation”) is a shell corporation with no operations or employees.   

4. Defendants Synergy Settlement Services, Inc. (“Synergy”), Jason 

D. Lazarus, and Anthony F. Prieto, Jr. have installed the Foundation as a 

nominee trustee to attempt to hide the fact that Synergy, a for-profit 

corporation, Lazarus and Prieto perform all the trustee functions and profit 

from the trusts’ operations by collecting all fees and other funds stemming from 

operating the trusts.     

5. The Defendants’ operation of the pooled trusts has violated the 

antifraud and registration provisions of the federal securities laws in several 

ways.  First, Synergy, Lazarus, Prieto, and Defendant Special Needs Law 

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Firm, PLLC (“the Law Firm”) have misrepresented to potential trust 

beneficiaries that they would be joining a trust managed by a non-profit 

association under Section 1396p, and therefore would remain eligible for 

Medicaid and SSI benefits.  To the contrary, because Synergy, Lazarus, and 

Prieto operated and managed the trusts for their own profit, they created a 

situation where the trust funds could count as beneficiaries’ assets and 

jeopardize their Medicaid and SSI benefits.   

6. Synergy, Lazarus, and Prieto have lied about the for-profit 

operation and management of the trusts to beneficiaries, the Internal Revenue 

Service, and the Social Security Administration (“SSA”), through emails, firm 

brochures, marketing materials, trust documents and operating agreements, 

among other documents.  

7. In addition, Synergy, Lazarus, and Prieto improperly diverted all 

trustee fees, which come directly from beneficiaries’ accounts, to Synergy.  

These Defendants also improperly used funds from deceased beneficiaries’ 

accounts to reimburse themselves for employee salaries and other expenses, as 

well as to make donations to trial lawyers’ and other organizations that 

violated their representations to the IRS and beneficiaries that they would only 

use such funds to further the trusts’ mission to help the disabled.   

8. Synergy, Lazarus, and Prieto have also misled beneficiaries with 

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respect to the investment of the pooled trusts’ assets.  From 2015 to 2017, the 

Defendants did not tell beneficiaries they were investing their money in a 

certain class of mutual fund that doubled the fees the Defendants told the 

beneficiaries they were paying. 

9. The trusts are invested in securities, and the trust instruments are 

securities the Defendants are offering and selling to beneficiaries.  Because the 

trusts are not operated and managed by a non-profit association, they do not 

qualify for exemptions from registration available to charitable organizations 

under the securities laws, and the Defendants have violated the registration 

requirements by offering and selling investments in the trusts without 

registering the offerings with the Commission. 

10. As a result of this conduct, the Defendants have violated Sections 

5(a), 5(c) and 17(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§ 

77e(a), 77e(c), 77q(a); Section 10(b) and Rule 10b-5 of the Securities Exchange 

Act of 1934 (“Exchange Act”), 15 U.S.C. § 78j(b) and 17 C.F.R. § 240.10b-5; 

and/or Sections 206(1), 206(2) and 206(4) and Rule 206(4)-8 of the Investment 

Advisers Act of 1940 (“Advisers Act”), 15 U.S.C. § 80b-6(1), (2), (4) and 17 

C.F.R. § 275.206(4)-8. 

11. The Commission requests that the Court enter orders: (i) 

permanently restraining and enjoining the Defendants from violating these 

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provisions of the federal securities laws; (ii) directing the Defendants to pay 

disgorgement with prejudgment interest; and (iii) directing Synergy, the Law 

Firm, Lazarus and Prieto to pay civil money penalties. 

II.  DEFENDANTS AND OTHER RELEVANT ENTITIES 

A.  Defendants 

12. Synergy is a Florida for-profit corporation with its principal place 

of business in Orlando, Florida.   

13. Foundation is a Florida non-profit 501(c)(3) private foundation 

with its principal place of business in Orlando, Florida.  

14. The Law Firm is a Florida professional limited liability 

corporation with its principal place of business in Orlando, Florida. 

15. Lazarus, age 52, of Orlando, Florida, is an attorney licensed to 

practice in the State of Florida.  Lazarus is the chief executive officer and 

largest shareholder of Synergy, sole owner of and practitioner at the Law Firm, 

and president and a director of the Foundation. 

16. Prieto, age 48, of Tampa, Florida, is a Certified Financial Planner 

and an investment adviser representative of an investment adviser registered 

with the Commission.  Prieto is president and a minority owner of Synergy, 

and a director of the Foundation.  Prieto was an officer of the Foundation until 

March 2017.   

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   B.  Other Relevant Entities 

17. Settlement Solutions National Pooled Trust (“SSNPT”) is a 

special needs pooled trust for disabled individuals that purports to preserve 

their Medicaid and SSI benefits pursuant to Section 1396p.  As of April 3, 2022, 

SSNPT had 316 beneficiaries and total assets of approximately $30.7 million.  

Since May 2015, Foundation has been the named trustee of SSNPT. 

18. Settlement Management National Pooled Trust (“SMNPT”) 

is a pooled trust for personal injury victims, often minors and incompetents in 

lieu of guardianship proceedings.  Per its master trust agreement, “[t]he 

purpose of [SMNPT] is to provide a vehicle for investment management” for its 

beneficiaries.  The trustee may, in its discretion, place beneficiaries in a 

Section 1396p trust to qualify for Medicaid or SSI.  As of April 3, 2022, SMNPT 

had 65 beneficiaries and total assets of approximately $15.5 million.  Since 

March 2016, Foundation has been the named trustee of SMNPT. 

III.  JURISDICTION AND VENUE 

19. The Court has jurisdiction over this action pursuant to Sections 

20(b), 20(d)(1) and 22(a) of the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d)(1) and 

77v(a); Sections 21(d), 21(e) and 27(a) of the Exchange Act, 15 U.S.C. §§ 78u(d), 

78u(e) and 78aa(a); and Sections 209 and 214 of the Advisers Act, 15 U.S.C. §§ 

80b-9 and 80b-14. 

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20. The Court has personal jurisdiction over the Defendants and 

venue is proper in this District because, among other things, the Defendants 

reside and transact business in this District.  They also participated in the 

offer, purchase, or sale of securities in this District, and many of their acts and 

transactions constituting the violations alleged in this Complaint occurred in 

this District.  In addition, venue is proper in this District under 28 U.S.C. § 

1391 because a substantial part of the events giving rise to the Commission’s 

claims occurred here. 

21. In connection with the conduct alleged in this Complaint, the 

Defendants, directly and indirectly, singly or in concert with others, have made 

use of the means or instrumentalities of interstate commerce, the means or 

instruments of transportation or communication in interstate commerce, and 

of the mails. 

IV.  FACTUAL ALLEGATIONS 

A.  Special Needs Pooled Trusts 

22. Virtually all of the SSNPT or SMNPT beneficiaries are disabled or 

incompetent individuals or minors who have received awards or settlements in 

personal injury lawsuits.  Section 1396p permits Medicaid and SSI recipients 

to retain their benefits despite receiving assets from these awards or 

settlements that would otherwise place them above the income eligibility limits 

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for the government assistance.   

23. To retain eligibility for benefits under Section 1396p, the 

beneficiaries must place the assets they receive in an irrevocable pooled trust 

established and managed by a non-profit association.  The beneficiaries can 

then get approval from the trustee to use the assets for certain types of 

expenses governed by the statute to supplement their Medicaid or SSI benefits. 

24. Section 1396p expressly permits the assets of such trusts to be 

pooled for investment purposes, but the assets of each beneficiary must be held 

in a separate sub-account to be distributed by the trustee for the sole benefit 

of that beneficiary.   

25. Upon the beneficiary’s death, the trusts may retain the sub-

account balance (“retained funds”) depending on the requirements of state law, 

whether the beneficiaries have designated remainder beneficiaries, and the 

language of the trust documents.  Trusts that keep retained funds must use 

them in keeping with the representations in trust documents and the legal 

obligations of special needs pooled trusts and their trustees. 

26. The SSA maintains a Program Operations Manual System 

(“POMS”) with policy statements, guidelines for Section 1396p pooled trust 

operations, and interpretations of relevant laws.  The POMS allows non-profit 

trustees to use the services of other entities to help manage the trusts.  

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However, under the POMS “[i]f a non-profit association employs the services 

of a for-profit entity, the non-profit association must maintain ultimate 

managerial control over the trust . . . [T]he use of a for-profit entity must 

always be subordinate to the non-profit managers.”   

27. The POMS identifies various forms of authority “that must vest in 

the non-profit association” (i.e., cannot be delegated), including determining 

the amount of the trust corpus to invest and making the day-to-day decisions 

regarding the health and well-being of pooled trust beneficiaries. 

B.  The Foundation 

28. The Foundation was incorporated in Florida in February 2012.  Its 

officers and directors have all been principals or employees of Synergy, and it 

shares an address with Synergy.  Lazarus, the largest shareholder of Synergy 

and its CEO, is the president and a director of the Foundation.  Prieto, a 

minority shareholder and president of Synergy, is a director of the Foundation 

and was an officer until 2017.  The Foundation’s three other currently listed 

officers and directors are owners or employees of Synergy.     

29. The Foundation’s by-laws state that “the specific purposes for 

which the Corporation is formed is to assist personal injury victims with 

special needs, either directly or indirectly.”  Its articles of incorporation list the 

identical purpose for which the Foundation was formed.  Furthermore, the 

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Foundation’s articles of incorporation state that “the Corporation shall not 

allow any part of the net earnings of the Corporation to inure to the benefit or 

be distributable to any private person, member, director or officer of the 

Corporation . . .” 

30. Shortly after its incorporation, in August 2012, the Foundation 

applied to the IRS for non-profit, tax-exempt status under Section 501(c)(3) of 

the Internal Revenue Code.  Lazarus signed the application as director and 

president of the Foundation.  In the section of the application entitled 

“Narrative Description of Your Activities” the Foundation reiterated:  

The specific purpose for which the Foundation was formed is to provide:  
(i) personal injury victims with special needs, through individual grants, 
supplemental assistance needed to obtain the care and services necessary for 
recovery/rehabilitation/education, helping to alleviate financial difficulties and (ii) 
funding of 501(c)(3) non-profit organizations operating specifically in the areas of 
providing personal injury victims with special needs, assistance to obtain the care 
and services necessary for recovery/rehabilitation/education. 

 
31. The application further described what organizations the 

Foundation would donate money to and the process by which the corporation 

would decide on its donations: 

Foundation Directors will research potential recipients, the personal injury 
suffered and the special needs of each. 
 
The Foundation plans to provide recipients with supplemental assistance to 
obtain the care and services necessary for recovery/rehabilitation/education 
helping to alleviate financial difficulties. 
 
Foundation Directors will research potential recipient 501(c)(3) non-profit 
organizations operating specifically in the areas of providing personal injury 

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victims with special needs, assistance to obtain the care and services necessary 
for recovery/rehabilitation/education . . . . 
 
The Foundation will be providing assistance to (i) personal injury victims with 
special needs and (ii) 501(c)(3) non-profit organizations operating specifically in 
the areas of providing personal injury victims with special needs, assistance to 
obtain the care and services necessary for recovery/rehabilitation/education. 
 

32. The application also stated that the Foundation: (i) had no 

arrangements with related entities; (ii) followed a conflict-of-interest policy, 

including consideration of alternative service providers; and (iii) had no 

revenue-sharing joint ventures.   

33. Based on these representations, the IRS granted the Foundation 

501(c)(3) status, a decision the SSA relied on in accepting the Foundation as a 

valid non-profit association that purportedly operated and managed SSNPT 

under Section 1396p.  During the SSA’s review of SSNPT’s master trust 

agreement in 2016, Synergy represented that SSNPT operated in accordance 

with the terms of the agreement – that the Foundation was a legitimate 

501(c)(3) entity and managed SSNPT as trustee. 

34. Foundation became the SSNPT trustee in 2015.  On May 15, 2015, 

Prieto signed the master trust agreement for SSNPT on behalf of the 

Foundation as the named trustee.  Prieto signed subsequent amendments to 

the SSNPT master trust agreement in March 2016 and December 2016 on 

behalf of the Foundation.  Similarly, on March 16, 2016, Prieto signed the 

master trust agreement for SMNPT on behalf of the Foundation as the named 

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trustee.   

35. Both the SSNPT and SMNPT master trust agreements 

represented that the Foundation was the trustee and is a “501(c)(3) non-profit 

corporation,” and that the pooled trust property “is to be administered and 

distributed by” the Foundation. 

C.  Marketing, Selling, And Operating The Trusts  

36. Synergy is a for-profit company that offers a host of structured 

financial products, including SSNPT and SNMPT.  Synergy’s main source of 

business is personal injury trial lawyers whose clients frequently are disabled, 

minors, and/or have guardians, and who receive funds from personal injury 

and other legal proceedings.  Synergy, largely through Lazarus and The Law 

Firm, aggressively markets SSNPT and SNMPT to these lawyers. 

37. To that end, Synergy, Lazarus, and the Law Firm send a variety 

of marketing and other documents containing information about the trusts.  

Among these documents are a joinder agreement that each beneficiary 

enrolling in a trust must sign, in which they acknowledge and adopt the trust’s 

master trust agreement and agree that they are placing assets irrevocably into 

the trust they are joining.  There are also marketing brochures describing the 

benefits of joining a trust (i.e., retaining Medicaid and SSI benefits), uses of 

and limitations on the trusts (such as how and for what types of expenses 

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beneficiaries can receive distributions); what happens to any remaining funds 

in the trusts upon the death of a beneficiary; and purported options for 

investing funds in the trusts.     

38. When recruiting new beneficiaries for SSNPT and SMNPT, 

Lazarus cross-sells the legal services of the Law Firm to represent the 

beneficiaries in joining the trusts.  The Law Firm charges each client $1,500 

for its services in helping them join SSNPT and SMNPT.   The Law Firm’s 

invoice for the $1,500 fee describes the legal representation as “regarding 

establishment of pooled settlement trust,” including “all consultations and 

communications regarding the Trust [and] preparation and drafting of the 

Trust.” 

39. In 2015, Synergy signed an agreement with an unaffiliated for-

profit firm, National Trust and Fiduciary Services Company, Inc., d/b/a 

Eastern Point Trust Company (“EPT”) to act as the administrator for SSNPT 

and SMNPT.  In practice, Lazarus, Prieto, and Synergy delegated almost all 

authority over the trust administration to EPT.  EPT developed several model 

investment portfolios for beneficiaries and handled all aspects of investing 

trust assets in securities.  In addition, Lazarus, Prieto, and Synergy delegated 

the sole discretion to respond to and approve or deny distribution requests from 

beneficiaries.  EPT only conferred with Synergy (through Lazarus, Prieto, and 

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other Synergy employees) on a handful of distribution requests which, in EPT’s 

judgment, required further consideration. 

40. In 2017, Synergy and EPT terminated their relationship.  Synergy 

then found another unaffiliated for-profit investment adviser, True Link 

Financial Advisors, LLC, to handle the investment and asset management 

functions for both SSNPT and SMNPT.  Since 2017, Synergy has controlled 

beneficiary distributions and other day-to-day decisions involving SSNPT and 

SMNPT, while True Link has handled the investment of trust assets.  

41. In addition to the $1,500 fee to the Law Firm, beneficiaries pay a 

$500 or $550 “joinder fee” (the amount has varied over time).  A portion of that 

fee has gone to either EPT or True Link, and the remainder has gone to 

Synergy, even though the Defendants represent that the Foundation charges 

the joinder fee.  Also as described in more detail below, beneficiaries have paid 

an annual trustee fee of either one percent (when EPT was the administrator) 

or .75 percent (when True Link was the administrator) of the value of the 

assets in their sub-account.  The administrator deducts the fee directly from 

each sub-account and sends it to Synergy.  From 2015 through 2019, Synergy 

earned in excess of $675,000 from trustee fees, and has earned more since then.  

Synergy has earned more than $100,000 from the joinder fee.   

42. The Defendants offer and sell the pooled trusts to beneficiaries as 

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investment contracts.  Beneficiaries are provided membership in the trusts in 

exchange for them transferring funds from their monetary settlements or 

awards irrevocably into the trusts.  As allowed under Section 1396p, the trusts 

pool investor funds together for investment purposes.  The success of the 

investments depends on the efforts of the Defendants and their chosen 

investment advisers.  Once they join the trusts and select an investment model 

developed by the Defendants and their investment advisers, the beneficiaries 

have no involvement in the investment of their funds. 

43. Although beneficiaries have sought to join SSNPT in part to 

preserve their Medicaid and SSI benefits, the Defendants also market the 

trusts in brochures as “getting more than just protection of public benefits.”  

They promise beneficiaries advantages “including high quality investment 

management services” and “better interest rates.”  The Defendants also claim 

the trusts are superior to other pooled trusts because “the sub-accounts are 

actively managed by professional money managers,” which “allows for a higher 

rate of return than would be possible if funds were invested separately . . . The 

sub-account funds, like other investments . . . may lose value.  There is no 

guarantee that the money will grow or be secure.”  Lawyers for potential 

beneficiaries have frequently asked Lazarus and Prieto how the funds will be 

invested or if they will earn interest. 

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44. No registration statement has been in effect for the pooled trusts 

during the time of the events set forth in this Complaint.  Furthermore, no 

exemptions from registration are available, including exemptions for 

charitable organizations under the Securities Act, the Exchange Act, the 

Advisers Act, and the Investment Company Act. 

D.  The Defendants’ Misrepresentations And Omissions 

1.  The Defendants Misrepresent That The Foundation Manages The Trusts 

45. Lazarus, Prieto, and Synergy, in marketing materials, trust 

documents, emails, letters, websites, and elsewhere, repeatedly have stated to 

potential beneficiaries they should join SSNPT because it is a Section 1396p 

trust established and managed by a non-profit association - the Foundation.  

46. For example, in November 2015, Lazarus gave a presentation 

touting “How is the SSNPT different from other pooled trusts?” with such 

details as “Foundation…is Non-Profit Trustee” and “Lowest fees nationally” of 

just $550 at inception and “Annual trustee fee – 1% of assets held in trust” 

(emphasis in original). 

47. In another example, Lazarus directed a March 2018 Synergy blog 

post stating a pooled settlement trust “is managed by a non-profit entity who 

created it and acts as trustee.  As a result of this arrangement, it is a low-cost 

way for a client to set up a trust for their benefit. . . . The trustee of the SMNPT 

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is the Foundation for Those with Special Needs a 501(c)(3) non-profit created 

specifically to act as trustee for trusts such as this.” 

48. In an email dated May 17, 2018, Lazarus told a prospective 

beneficiary: “I am not the trustee.  Under Federal Law, the trustee must be a 

non-profit.  In this case it is the Foundation.”   Also, by email dated October 1, 

2018, Lazarus told a prospective beneficiary that SSNPT “is administered by 

a non-profit called the Foundation.”   

49. Prieto made similar statements.  On April 19, 2018, he presented 

a webinar stating special needs pooled trusts must be “managed by Not for 

Profit Trustee pursuant to federal law,” with SSNPT and SMNPT identified as 

“available trust solutions.”  By email dated August 23, 2018, Prieto told a 

representative of a prospective beneficiary “The Trustee [of SSNPT] is The 

Foundation for Those with Special Needs, Inc.” 

50. Additionally, SSNPT’s website has stated: “Under federal law, a 

pooled special needs trust must be created and managed by a non-profit 

trustee.  SSNPT is managed by [Foundation] who acts as the trustee. . . .  While 

this is a difficult reality to face, turning your settlement over to a trustee of a 

special needs trust, it is what is required by federal/state law to remain eligible 

for needs based benefits.” 

51. In their retainer letter, the Law Firm and Lazarus assure 

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beneficiaries that “[t]he creation of a pooled trust sub-account will insure that 

[their] settlement proceeds will not be treated as a countable asset for purposes 

of qualifying for Medicaid and/or SSI,” and that the Law Firm would “adhere 

to proper and approved special needs trust structure and format.”  In an email 

dated April 11, 2017, Lazarus, in his capacity at the Law Firm, pressured the 

mother of a prospective beneficiary: “The purpose of the trust is [to] preserve 

Medicaid eligibility.  Without the trust, your daughter would lose coverage. . . 

.  Of course you can decide not to set up the trust and lose Medicaid until the 

money is completely gone.”   

52. Finally, the Defendants consistently represent to beneficiaries 

that the trustee and joinder fees described above are paid to the Foundation as 

the trustee.  For example, the Administrative Services Agreements that both 

EPT and True Link signed that included provisions for deducting and paying 

the trustee fees were with the Foundation, not Synergy.  Additionally, a 

Welcome Kit that beneficiaries receive upon joining states that the trustee – 

the Foundation – charges the joinder and annual fees.    

53. All of these representations are false.  The Foundation is a shell 

company with no employees, operations, or even a single email address.  

Rather, Lazarus and Prieto have Synergy employees perform all work in 

connection with SSNPT or SMNPT – or perform it themselves – without any 

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written agreements with the Foundation or invoices to the Foundation 

regarding any such work.  Lazarus and Prieto respond to all inquiries from 

beneficiaries about trust operations.  Other Synergy employees have answered 

calls from beneficiaries, as well as exchanged emails with True Link regarding 

investment of the trust assets.   

54. Synergy: induces beneficiaries to join the SSNPT and SMNPT 

based in part on promised investment performance; has had discussions with 

individual beneficiaries about investment options; and has the authority to 

invest each beneficiary’s funds.  Lazarus advises beneficiaries on acquiring 

interests in SSNPT and SMNPT.  Prieto has advised some beneficiaries on 

investments, approved the portfolios by which SSNPT and SMNPT assets were 

invested, and primarily handled the reinvestment of SSNPT and SMNPT 

assets during the transition from EPT to True Link.       

55. Furthermore, the trustee fees purportedly paid to the Foundation 

under the Administrative Services Agreements are, in reality, paid directly to 

Synergy as part of its for-profit control of SSNPT and SMNPT.  To attempt to 

justify receiving the trustee fees, Synergy entered into sham agreements with 

EPT and True Link pursuant to which each firm was supposed to pay a 

marketing fee to Synergy for purportedly marketing EPT or True Link’s 

services.  The alleged marketing fee in both cases has been equal to the trustee 

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fee under the Administrative Service Agreements. 

56. In reality, Synergy has done little or no marketing of either EPT 

or True Link’s services.  For example, the only “marketing” Synergy has done 

for True Link is to mention in Synergy’s brochures marketing the trusts to trial 

lawyers that True Link is the investment advisor, and to include True Link’s 

own previously prepared firm descriptions in the brochures.  Furthermore, 

there is no separate marketing fee – both EPT and True Link paid only the 

trustee fee to Synergy.  The marketing agreement was merely a ruse to attempt 

to hide the fact that Synergy, not the Foundation, has received all trustee fees.    

57. Lazarus confirmed the bogus nature of the marketing fee by email 

dated June 4, 2014, telling an EPT representative that Synergy “would get the 

trustee fee at inception, which would be collected by [EPT] and then paid over 

to Synergy as some sort of marketing arm or something like that.”  Synergy’s 

internal strategic plans also tout the trustee fees as “significant recurring 

revenue” every year over the lifetime of the beneficiaries of SSNPT and 

SMNPT.   

58. To maintain the façade that SSNPT and SMNPT have a non-profit 

trustee, Lazarus and Prieto specifically told Synergy employees not to mention 

Synergy when marketing SSNPT and SMNPT.  Lazarus instructed a Synergy 

employee in a June 1, 2018 email: “Synergy is the marketing arm for the pooled 

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trusts but isn’t involved corporately with the trusts (if that makes sense).  The 

only corporate entity related to the trusts is the Foundation.”   

59. Five days later, Lazarus told True Link in an email to “make sure 

that we never reference Synergy on any of the pieces for the pooled trust.  

Synergy is the marketing arm for the trusts but that is it.” In a February 6, 

2018 email, Prieto told Lazarus that Synergy’s name should be removed from 

account statements the trusts sent to SSNPT and SMNPT beneficiaries. 

2.  The Defendants Make Misrepresentations About Pooled Trust Fees 

60. While EPT was trust administrator, the Defendants invested 

beneficiaries’ funds in one of seven portfolios comprised of the same set of 

equity and fixed-income mutual funds (with varying percentages to reflect 

different risk tolerance levels), and a money market balance of 0 to 14 percent. 

61. All the mutual fund positions were in a particular class of mutual 

fund shares: Class C shares.  Class C shares carry the highest of certain kinds 

of fees payable to broker-dealers to cover fund distribution and shareholder 

service expenses known as 12b-1 Fees.  These recurring fees, which are included 

in a mutual fund’s total annual fund operating expenses, are approximately 

one percent per year and are deducted from the mutual fund’s assets on an 

ongoing basis.  As a result, 12b-1 Fees are paid by investors in Class C shares.   

62. Therefore, from 2015 to 2017, the beneficiaries of SSNPT and 

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SMNPT each year paid approximately one percent of their total assets in fees 

due to the Defendants investing their funds in Class C shares.  At the time, 

EPT wholly owned a registered broker-dealer that collected 12b-1 Fees on the 

Class C share holdings and sent them (net of expenses) to EPT as its 

compensation for acting as trust administrator for SSNPT and SMNPT. 

63. Prieto and Lazarus knew EPT would be compensated for its role 

as administrator for the two trusts solely from 12b-1 Fees on Class C shares.  

In a May 19, 2014 email discussing EPT becoming trust administrator, EPT 

wrote that its proposal would allow for “lower public trustee fees” by using the 

fees from their proposed investment portfolios (all of which were comprised of 

Class C shares) as compensation to EPT.  Furthermore, on January 10, 2017, 

Prieto acknowledged EPT was being paid through 12b-1 Fees:  “[EPT] is 

earning roughly 1% from the funds they use. . . .  The end client is not seeing 

the fee it is [embedded] into the expense of the funds.”  

64. Lazarus, Prieto, and Synergy did not disclose to beneficiaries that 

they were, in effect, paying the 12b-1 Fees to EPT.  In June 2015, the 

Defendants reviewed and approved a notice sent to beneficiaries stating “some 

of the many resulting benefits of [EPT] being the administrator are cost 

reductions for annual fees and a wider array of investment options.  The 

annual fee will drop from 2% down to 1%.”  Thus, the Defendants only told the 

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beneficiaries they were paying a trustee fee of one percent and a $500 joinder 

fee – with no mention of the additional one percent 12b-1 Fees.  Nor did the 

Defendants provide beneficiaries with prospectuses for the mutual funds or 

other fee or class-specific disclosures.   

3.  The Defendants Misrepresent Their Use of Retained Funds  

65. Section 1396p refers indirectly to funds in a beneficiary’s sub-

account being “retained by the trust” upon the death of a beneficiary, but is 

silent on the circumstances under which a pooled trust may retain those funds 

and the uses to which the trust may put those retained funds.  However, 

Internal Revenue Code Section 501(c)(3) specifies that non-profits granted tax-

exempt status must generally use their funds for charitable purposes or the 

express purposes for which the entity was created.   

66. As noted above, in its 501(c)(3) application, the Foundation 

expressly represented to the IRS on multiple occasions that its specific purpose 

is to assist personal injury victims with special needs, and that it would fund 

“non-profit organizations operating specifically in the areas of providing 

personal injury victims with special needs.”  Both the Foundation’s by-laws 

and articles of incorporation contain similar descriptions of its purpose.   

67. In addition, Synergy, Lazarus, and Prieto have represented in 

numerous documents sent to actual and prospective beneficiaries that they 

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would use a beneficiary’s retained funds expressly to further the trusts’ 

mission of serving people with disabilities.  For example, the joinder 

agreements beneficiaries sign to join the trusts allow beneficiaries to choose 

among several options of what will happen to any funds still in their sub-

accounts when they die.  Among the options is allowing the trust to retain the 

funds, in which case the joinder agreement states the trust will use the funds 

“to help the Settlement Solutions National Pooled Trust with its important 

non-profit mission of serving individuals with disabilities.” 

68. Similarly, letters Lazarus writes to lawyers for beneficiaries 

considering joining one of the trusts attach a client intake form, which includes 

several options for funds remaining in a sub-account.  The “retained funds 

option” states: “if money is left in the sub-account when the trust Beneficiary 

passes away then the funds shall be retained by the Trust to help the 

Settlement Solutions National Pooled Trust with its important non-profit 

mission of serving individuals with disabilities.” 

69. The Welcome Kit the Defendants send to new beneficiaries 

includes a “Schedule C – Authorized Representative and Remainder 

Beneficiary Designation.”  The “Retained By Trust” option has identical 

language to the client intake form attached to Lazarus’ letters.   

70. Lazarus sent an email to colleagues at Synergy on May 18, 2016, 

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attaching a proposed marketing brochure to send to trial lawyers.  The 

brochure states in relevant part that “SSNPT was created for the singular 

purpose of assisting injury victims to remain eligible for needs-based public 

assistance benefits,” and “our trust makes it possible for remaining assets to 

be returned to the family at death in certain situations, or remain in the trust 

for the benefit of other persons with disabilities.”   

71. Although a one-page information sheet about both SSNPT and 

SNMPT the Defendants sent to some potential beneficiaries states that the 

Foundation was created both to assist people with disabilities and to give back 

to the civil justice system, this representation directly contradicts statements 

in the Foundation’s 501(c)(3) application, articles of incorporation, by-laws, 

and numerous other trust documents the Defendants sent to beneficiaries.   

72. Contrary to their representations, Lazarus, Prieto, and Synergy 

have not used a significant portion of retained funds to help the disabled or 

other people with special needs.  Instead, Synergy has diverted all of the funds 

from the SSNPT operating account to a separate bank account in the name of 

the Foundation, from where Lazarus and Prieto have used funds largely to 

further their own, for-profit interests.  

73. Since August 2018, Synergy has used at least $132,000 to pay trust 

administrative expenses, when it already collected the one percent trustee fee 

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purportedly to pay those same expenses.  Synergy financial statements 

indicate that since 2015 the annual trustee fee has exceeded the trusts’ 

administrative expenses – leaving no need for use of retained funds to pay 

those expenses.  Synergy’s use of retained funds to purportedly cover expenses, 

while also collecting the one percent trustee fee, did not reduce the amounts 

charged to beneficiaries for administrative costs.     

74. The Defendants also used retained funds to pay administrative 

expenses that had nothing to do with the trusts.  For example, they used 

retained funds to pay the premiums on a Synergy business insurance policy. 

75. In addition, Synergy has spent at least $300,000 on donations to 

trial lawyers’ organizations or charities of which the Defendants are a member 

or have friends and acquaintances who serve in important positions in them 

that have nothing to do with assisting disabled persons.  Some organizations 

were not even 501(c)(3) non-profits.  Numerous emails among Lazarus, Prieto 

and their Synergy partners make it clear that the main criteria for choosing 

recipients of the beneficiaries’ retained funds was to promote Synergy’s for-

profit business interests.  Among the recipients of Synergy’s largesse with 

retained funds have been golf tournaments, beach parties, and a holiday party 

organized by legal friends, clients, and acquaintances of Lazarus and his 

Synergy partners. 

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76. Lazarus and Prieto have confirmed the purpose of these 

disbursements of retained funds in internal emails.  For example, Lazarus 

wrote in a December 10, 2015 email that Synergy should sponsor an event at 

the request of a fellow lawyer because “this is targeted to the legal community 

so it does give us good bang for the buck.”  In another instance, Prieto agreed 

to contribute $1,000 to a golf tournament organized by a lawyer who another 

Synergy lawyer described as “my best client” who had recently arranged for 

money to be spent on Synergy financial products. 

77. Other examples include: 

a. In June 2015, Synergy used retained funds to pay $15,000 to a group 

of trial lawyers who had achieved large settlements.  In March 2015, 

Lazarus had sent the group’s founder, a client of Lazarus, a proposal 

for an “exclusive annual sponsorship” by which Synergy could attend 

group social events, provide webinars, and be recognized as a sponsor 

in membership emails and “business partner” on the group’s website.  

Soon after Synergy’s $15,000 payment, in November 2015, Prieto 

prepared a presentation for Lazarus to make to that group about all 

of Synergy’s lines of business titled “Synergy Settlement Services: 

Allowing Trial Lawyers to Focus on What They Do Best.”   

b. In January 2016, Synergy used retained funds to pay the professional 

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dues for Synergy employees to be named as sponsoring fellows of a 

think tank created by trial lawyers.  

c. From 2015 through 2018, Synergy used retained funds to pay for a 

named sponsorship at a holiday event for the lawyer alumni group of 

a private high school in Tampa.  Synergy made the payments at the 

request of a lawyer who frequently refers business to Synergy.    

d. In June 2015, June 2016 and July 2017, Synergy used retained funds 

to pay for a named sponsorship at judicial luncheons hosted by a legal 

mentoring organization for worker’s compensation lawyers. 

e. In August 2015, July 2016 and July 2017, Synergy used retained 

funds to pay for a named sponsorship at a beach party held by a trial 

lawyer association unrelated to the disabled community. 

f. In November 2015, Synergy sponsored a project involving a trial 

lawyer for construction activities in a Berber village in Morocco 

unrelated to the disabled community. 

 
V.  VIOLATIONS ALLEGED 

 
COUNT I 

Violations of Section 17(a)(1) of the Securities Act 

(Against All Defendants) 

78. The Commission repeats and realleges Paragraphs 1 through 77 of 

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its Complaint as if incorporated herein. 

79. From no later than May 2015 to the present, the Defendants, in 

the offer or sale of any securities by the use of any means or instruments of 

transportation or communication in interstate commerce or by use of the mails, 

directly or indirectly, knowingly or severely recklessly, employed any device, 

scheme or artifice to defraud. 

80. By reason of the foregoing, the Defendants violated, and, unless 

enjoined, are reasonably likely to continue to violate, Section 17(a)(1) of the 

Securities Act, 15 U.S.C. § 77q(a)(1). 

COUNT II 

Violations of Section 17(a)(2) of the Securities Act 

(Against All Defendants) 

81. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

82. From no later than May 2015 through the present, the Defendants, 

in the offer or sale of any securities by the use of any means or instruments of 

transportation or communication in interstate commerce or by use of the mails, 

directly or indirectly, negligently obtained money or property by means of 

untrue statements of material facts or omissions to state material facts 

necessary to make the statements made, in light of the circumstances under 

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which they were made, not misleading. 

83. By reason of the foregoing, the Defendants violated, and, unless 

enjoined, are reasonably likely to continue to violate, Section 17(a)(2) of the 

Securities Act, 15 U.S.C. § 77q(a)(2). 

COUNT III 

Violations of Section 17(a)(3) of the Securities Act 

(Against All Defendants) 

84. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

85. From no later than May 2015 through the present, the Defendants, 

in the offer or sale of any securities by the use of any means or instruments of 

transportation or communication in interstate commerce or by use of the mails, 

directly or indirectly, negligently engaged in transactions, practices and 

courses of business which operated or would have operated as a fraud or deceit 

upon the purchasers and prospective purchasers of such securities. 

86. By reason of the foregoing, the Defendants violated, and, unless 

enjoined, are reasonably likely to continue to violate, Section 17(a)(3) of the 

Securities Act, 15 U.S.C. § 77q(a)(3). 

 
 
 
 

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COUNT IV 
 

Violations of Section 10(b) and Rule 10b-5(a) of the Exchange Act 

(Against All Defendants) 

87. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

88. From no later than May 2015 through the present, the Defendants, 

directly and indirectly, by use of any means or instrumentality of interstate 

commerce, or of the mails, knowingly or severely recklessly employed any 

device, scheme or artifice to defraud in connection with the purchase or sale of 

any security. 

89. By reason of the foregoing, the Defendants violated, and, unless 

enjoined, are reasonably likely to continue to violate, Section 10(b) and Rule 

10b-5(a) of the Exchange Act, 15 U.S.C. § 78j(b), and 17 C.F.R. § 240.10b-5(a). 

COUNT V 

Violations of Section 10(b) and Rule 10b-5(b) of the Exchange Act 

(Against All Defendants) 

90. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

91. From no later than May 2015 through the present, the Defendants, 

directly and indirectly, by use of any means or instrumentality of interstate 

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commerce, or of the mails, knowingly or severely recklessly made untrue 

statements of material facts and omitted to state material facts necessary in 

order to make the statements made, in light of the circumstances under which 

they were made, not misleading in connection with the purchase or sale of any 

security. 

92. By reason of the foregoing, the Defendants violated, and, unless 

enjoined, are reasonably likely to continue to violate, Section 10(b) and Rule 

10b-5(b) of the Exchange Act, 15 U.S.C. § 78j(b), and 17 C.F.R. § 240.10b-5(b). 

COUNT VI 

Violations of Section 10(b) and Rule 10b-5(c) of the Exchange Act 

(Against All Defendants) 

93. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

94. From no later than May 2015 through the present, the Defendants, 

directly and indirectly, by use of any means or instrumentality of interstate 

commerce, or of the mails, knowingly or severely recklessly engaged in acts, 

practices and courses of business which operated or would have operated as a 

fraud or deceit upon any person in connection with the purchase or sale of any 

security. 

95. By reason of the foregoing, the Defendants violated, and, unless 

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enjoined, are reasonably likely to continue to violate, Section 10(b) and Rule 

10b-5(c) of the Exchange Act, 15 U.S.C. § 78j(b), and 17 C.F.R. § 240.10b-5(c). 

COUNT VII 

Violations of Sections 5(a) and 5(c) of the Securities Act 

(Against Synergy, Lazarus, and Prieto) 

96. The Commission repeats and realleges Paragraphs 1 through 64 of 

its Complaint as if incorporated herein. 

97. From no later than May 2015 through the present, Synergy, 

Lazarus and Prieto, directly or indirectly, have made use of the means or 

instruments of transportation or communication in interstate commerce or of 

the mails to sell securities, when no registration statement was in effect with 

the Commission as to such securities, and have made use of the means or 

instruments of transportation or communication in interstate commerce or of 

the mails to offer to sell such securities when no registration statement had 

been filed with the Commission as to such securities. 

98. There were no applicable exemptions from registration. 

99. By reason of the foregoing, Synergy, Lazarus and Prieto violated, 

and, unless enjoined, are reasonably likely to continue to violate, Sections 5(a) 

and 5(c) of the Securities Act, 15 U.S.C. § 77e(a), (c). 

 

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COUNT VIII 

Violations of Section 206(1) of the Advisers Act 

(Against Synergy, Lazarus, and Prieto) 

100. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

101. From no later than May 2015 through the present, Synergy, 

Lazarus and Prieto, by engaging in the conduct set forth above, directly or 

indirectly, knowingly or severely recklessly, through use of the mails or the 

means or instrumentalities of interstate commerce, and while engaged in the 

business of advising others for compensation as to the advisability of investing 

in, purchasing, or selling securities, employed devices, schemes, or artifices to 

defraud.  

102. By reason of the foregoing, Synergy, Lazarus and Prieto violated, 

and, unless enjoined, are reasonably likely to continue to violate, Section 206(1) 

of the Advisers Act, 15 U.S.C. § 80b-6(1). 

COUNT IX 
 

Violations of Section 206(2) of the Advisers Act 

(Against Synergy, Lazarus, and Prieto) 

103. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

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104. From no later than May 2015 through the present, Synergy, 

Lazarus and Prieto, by engaging in the conduct set forth above, directly or 

indirectly, knowingly or severely recklessly, through use of the mails or the 

means or instrumentalities of interstate commerce, and while engaged in the 

business of advising others for compensation as to the advisability of investing 

in, purchasing, or selling securities, engaged in acts, practices, or courses of 

business which operated or would operate as a fraud or deceit upon clients or 

prospective clients.  

105. By reason of the foregoing, Synergy, Lazarus and Prieto violated, 

and, unless enjoined, are reasonably likely to continue to violate, Section 206(2) 

of the Advisers Act, 15 U.S.C. § 80b-6(2). 

COUNT X 

Violations of Section 206(4) and Rule 206(4)-8 of the Advisers Act 

(Against Synergy, Lazarus, and Prieto) 

106. The Commission repeats and realleges Paragraphs 1 through 77 of 

its Complaint as if incorporated herein. 

107. From no later than May 2015 through the present, Synergy, 

Lazarus and Prieto each acted as investment advisers, as defined by Section 

202(a)(11) of the Advisers Act, 15 U.S.C. § 80b-2(a)(11), to SSNPT and SMNPT 

and their beneficiaries. 

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108.   At all relevant times, SSNPT and SMNPT operated as a pooled 

investment vehicle, as defined by Rule 206(4)-8(b) under the Advisers Act, 17 

C.F.R. § 275.206(4)-8(b).  

109. Synergy, Lazarus and Prieto, by engaging in the acts and conduct 

alleged above, while acting as investment advisers to a pooled investment 

vehicle, by use of the means and instrumentalities of interstate commerce and 

of the mails, made untrue statements of a material fact or omitted to state a 

material fact necessary to make the statements made, in the light of the 

circumstances under which they were made, not misleading, to any investor or 

prospective investor in SSNPT and SMNPT, and otherwise engaged in acts, 

practices or courses of business that were fraudulent, deceptive, or 

manipulative with respect to any investor or prospective investor in SSNPT 

and SMNPT.  

110. By reason of the foregoing, Synergy, Lazarus and Prieto violated, 

and, unless enjoined, are reasonably likely to continue to violate, Section 206(4) 

of the Advisers Act, 15 U.S.C. § 80b-6(4), and Rule 206(4)-8 thereunder, 17 

C.F.R. § 275.206(4)-8. 

VI.  RELIEF REQUESTED 

WHEREFORE, the Commission respectfully requests the Court find 

the Defendants committed the violations alleged, and: 

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A. 

Permanent Injunction 

Issue a Permanent Injunction restraining and enjoining the Defendants, 

their officers, agents, servants, employees, attorneys, and all persons in active 

concert or participation with them, and each of them, from violating the federal 

securities laws alleged in this Complaint.  

B. 

Disgorgement 

Issue an Order directing the Defendants to disgorge all ill-gotten gains, 

including prejudgment interest, resulting from the acts or courses of conduct 

alleged in this Complaint. 

C. 

Penalties 

Issue an Order directing Synergy, Special Needs Law Firm, Lazarus and 

Prieto to pay civil money penalties pursuant to Section 20(d) of the Securities 

Act, 15 U.S.C. § 77t(d), Section 21(d) of the Exchange Act, 15 U.S.C. § 78u(d), 

and Section 209(e) of the Advisers Act, 15 U.S.C. § 80b-9(e). 

D. 

Further Relief 

Grant such other and further relief as may be necessary and appropriate. 

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E. 

Retention of Jurisdiction 

Further, the Commission respectfully requests that the Court retain 

jurisdiction over this action and over the Defendants in order to implement 

and carry out the terms of all orders and decrees that may hereby be entered, 

or to entertain any suitable application or motion by the Commission for 

additional relief within the jurisdiction of this Court. 

VII.  JURY TRIAL DEMAND 
 

The Commission demands a trial by jury on all issues so triable. 

 
 
Dated: May 2, 2022   By: s/Robert K. Levenson 
       Robert K. Levenson 
       Senior Trial Counsel 
       Fla. Bar No. 0089771 
       Telephone: (305) 982-6341 
       Facsimile: (305) 536-4154 
       E-mail:  [email protected] 
 
       Alice Sum 
       Trial Counsel 
       Fla. Bar No. 354510  
       Telephone: (305) 416-6293 
       Facsimile: (305) 536-4154 
       E-mail:  [email protected] 
 

ATTORNEYS FOR PLAINTIFF 
SECURITIES AND EXCHANGE 
COMMISSION 
801 Brickell Avenue, Suite 1950 

        Miami, Florida 33131  

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