The U.S. District Court has frozen the assets of a New Jersey investment advisor charged with misappropriating approximately $2.5 million from clients to support a lavish lifestyle.

The Securities and Exchange Commission announced this week that the court entered a preliminary injunction against Carlo G. Chiaese, 38, of Springfield, N.J.; his company, C.G.C. Advisors LLC; and relief defendant Micol Chiaese. The order requires the defendants to account for the money and freezes their assets until the SEC's enforcement action is decided.

The SEC filed a complaint October 5 that alleges that between 2008 and the present, Chiaese and CGC misappropriated the funds from at least six of their advisory clients, including a union pension trust fund that benefits about 880 members.

Instead of investing these funds as Chiaese promised, the SEC alleges, he used much of his clients' funds for mortgage payments on a million dollar home; approximately $32,000 on landscaping; approximately $70,000 on multiple country clubs; approximately $12,000 on his child's private school tuition; approximately $4,000 at a New York City hotel on New Year's Eve 2008; thousands of dollars on expensive cars; tens of thousands of dollars per month in living expenses; and numerous cash withdrawals. Micol Chiaese, an officer of CGC, benefited from this fraud by directly receiving at least $261,300 of clients' funds, the SEC claims.

The SEC is seeking an order that permanently enjoin Chiaese and CGC from committing future violations of securities laws. The SEC also wants the court to require Chiaese, Micol Chiaese and CGC to disgorge any ill-gotten gains and pay civil penalties.