PARSIPPANY — New Jersey securities regulators have ordered a Parsippny-based dance academy and its owner to immediately stop selling investments connected to what authorities describe as a nationwide fraudulent scheme that raised more than $5.4 million. (See related article by clicking here).
Attorney General Jennifer Davenport announced that the New Jersey Bureau of Securities issued a summary cease and desist order against Mystical Stars LLC, formerly Arya International Inc., and its owner, Rupal K. Patel. The business operates as Arya International, a South Asian dance academy located at 1571 Route 46 in Parsippany-Troy Hills.
According to the Bureau of Securities, Patel and Arya International raised $5,469,228 from 74 investors — including 48 New Jersey residents — through the sale of unregistered securities in the form of promissory notes. Authorities allege the scheme targeted friends and family members of students enrolled at the academy.
“As part of our commitment to tackling the affordability crisis, our office will hold financial predators accountable whenever they cheat New Jerseyans out of their hard-earned money,” Attorney General Davenport said. “Fraudulent investment schemes like the one run by Arya International cause significant financial harm to the public, unlawfully exploiting their trust and siphoning away their money. My office will continue to take action to halt fraudulent conduct and ensure compliance with the laws that protect our investors from financial predators.”
Authorities say Patel is not registered to sell securities in New Jersey and allegedly promoted the investments as safe opportunities offering returns between 10% and 20%, personally guaranteed by both the company and Patel.
“Rupal Patel used her position as head of Arya International to shamelessly prey on and financially exploit friends and families of her students,” said Jeremy E. Hollander, acting director of the Division of Consumer Affairs. “The Cease and Desist Order issued today demands they immediately stop this unlawful conduct and fully comply with our Uniform Securities Law.”
Officials said the order alleges that Patel and the company made untrue statements and omitted material facts in connection with the sale of the investments. Regulators found that Arya International had borrowed at least $1.96 million through merchant cash advance agreements between 2020 and 2023 and had assigned rights to future accounts receivable to those companies. Authorities also allege the academy shut down for three years during the COVID-19 pandemic, despite claims of post-pandemic expansion.
“This enforcement action not only halts any further sale of these unregistered securities in New Jersey, but also underscores the importance of verifying an investment before committing your money,” said Acting Bureau Chief Keith A. Alt. “By operating outside the regulatory framework of the securities industry, Patel and Arya International misled investors and withheld critical information that investors needed — and were legally entitled to receive — in order to make informed investment decisions.”
Regulators further allege the company failed to disclose that it had not paid certain state taxes, that its corporate charter was revoked in 2021 by the New Jersey Division of Taxation, and that the securities were not registered or exempt from registration as required by law.
The Bureau concluded that Patel and Arya International violated the New Jersey Uniform Securities Law by offering and selling unregistered securities and engaging in fraudulent practices. The order requires them to immediately cease the sale of the investments.
Authorities also reminded investors to verify the registration and disciplinary history of financial professionals before investing. Information is available through the New Jersey Bureau of Securities.
