A former Massachusetts investment advisor allegedly promised investors a good deal, but it was all smoke and mirrors.

Lee Weiss has been barred from the investment industry and will pay a $1 million civil penalty after allegedly convincing clients to invest more than $40 million in a scheme involving a cigarette filter purported to reduce the harmful effects of smoking.

Weiss and his firm, Family Endowment Partners (FEP), settled multiple fraud charges brought by the Securities and Exchange Commission in U.S. District Court, District of Massachusetts on June 20.

According to the SEC complaint, Weiss and FEP convinced clients to invest more than $40 million in illiquid securities issued by the subsidiary of a French company, which was purported to have designed methods to reduce the harmful effects of smoking, according the SEC complaint. But they did not disclose that Weiss had a stake in the parent company of the issuers or that he received payments from them.

Weiss allegedly received more than $600,000 in payments from the French company shortly after FEP clients invested in the subsidiaries. In July 2011, Weiss recommended a client invest an additional $2.5 million in one of the subsidiaries despite knowing the money would be used to pay delinquent interest owed to other FEP clients.

The SEC also alleged that Weiss recommended that clients invest $8.25 in notes or shares of entities that he owned and controlled without disclosing that the investments would primarily benefit FEP by allowing it to pay its financial obligations and without notifying investors that the notes might never be paid due to the companies’ financial condition.

Weiss and FEP advised clients to invest $5 million in a consumer loan portfolio while concealing that Weiss himself would secretly pocket half of the clients’ profits from the investments.

A portion of the proceeds, totaling more than $300,000, were allegedly funneled to an inactive real estate company owned by a “close friend” of Weiss, then transferred to Weiss and other third parties identified by Weiss.

The U.S. District Court ordered Weiss, FEP and four relief defendants--MIP Global Inc., Mosaic Enterprises Inc., Mosaic Investment Partners Inc. and Weiss Capital Real Estate Group--to pay disgorgement totaling more than $8.4 million, plus any applicable interest.

In a related administrative proceeding, the SEC permanently barred Weiss from associating with any broker-dealer, advisor, municipal securities dealer, municipal advisor, transfer agent or statistical rating organization. Weiss has 180 days to transfer any remaining assets and to wind down funds.

Last year, Weiss and FEP were ordered by an arbitrator to pay two clients $48 million in damages for the tobacco scheme.