State Commissioner of Securities Russel Yamashita on Wednesday issued a cease-and-desist order against Emmanuel Lagpacan and his companies -- Diablo Advisory Services, Kubasaki Resort Properties Inc. and $Money Matters$ Financial Consultants & Accountants -- from selling or soliciting securities in Hawaii.

Yamashita said that Lagpacan told his customers that he was investing their money in tax-deferred annuities, mutual funds and other funds offered by Waddell & Reed Inc., a West Coast brokerage. But Lagpacan instead put the money into his businesses and into purchases of speculative California, Hawaii and Texas real estate, Yamashita said.

Lagpacan denied any wrongdoing yesterday and said that he has not been contacted by the state. He said he plans to request an administrative hearing and contest the fine. He declined comment on the state's specific allegations.

Lagpacan said he is a registered investment adviser.

He also had been a registered stock broker but his broker's registration was terminated last year. Lagpacan said he has a total of about 100 customers in California and Hawaii.

Besides the state, the Securities and Exchange Commission is conducting an informal inquiry into Lagpacan's company, Lagpacan said. He said he is cooperating with the SEC and has offered to return money to investors who request it. Lagpacan declined to give details on the nature of the SEC investigation.

According to Yamashita, the state's cease-and-desist order and its fine requires approval from state Circuit Court.