About 120 Illinois and California residents thought they were investing more than $20 million in Turkish Eurobonds when, in fact, a Lisle man and others were spending the money on luxury automobiles, homes, vacations and online pornography, the Illinois Department of Insurance alleged Tuesday.

The state’s action follows a lawsuit filed by the Securities and Exchange Commission in March in which the federal regulator said the group was using the investors’ money to also buy a stamp collection, and also invest in “the cryogenic preservation of umbilical cord stem cells.”

The Illinois insurance department said it has revoked the license of a Lisle insurance agent, Robert C. Pribilski, and his Oakbrook Terrace-based companies, USA Financial Management Services Inc. and USA Retirement Management Services, for “luring Illinois and California retirees into a pyramid scheme in which the agent misrepresented that the funds would be used for the purchase of Turkish Eurobonds.”

He invited retirees to estate planning seminars, only to later coax them into buying promissory notes for purported Turkish investments with alleged interest returns between 8 percent and 11 percent, the state said.

Pribilski’s company and another individual raised at least $20 million from more than 120 investors, and used the funds to buy luxury automobiles, homes, vacations and pornography, according to state documents.

Pribilski’s lawyer said he’s fighting the charges.

“Shame on Blagojevich-appointee Insurance Director Michael T. McRaith for issuing public statements without an investigation and before the hearing scheduled for September 21,” said his lawyer, Mark Hathaway. “Mr. Pribilski didn’t run off with money and is fighting the charges. He lives in a $280,000 condo that is upside down and drives a 13-year-old Mercedes.”

But in April, the Illinois Secretary of State’s securities department permanently prohibited him from offering or selling any securities in or from Illinois. Pribilski and his securities aren’t registered with the SEC, the state said.

The SEC said the group sent mass mailings to prospective investors, inviting them to estate-planning seminars at country clubs and banquet halls. They then pitched what they represented as “safe, guaranteed investments in Turkish Eurobonds.” As recently as February, two investors bought $150,000 of the companies’ promissory notes, the SEC said.

Allegations in the SEC case include the unregistered offer and sale of securities, and fraud in the offer or sale of securities.

Pribilski and his associates also wired investor money into bank accounts belonging to individuals living in Turkey, the state said. As a result of Pribilski and his companies’ fraudulent actions, the insurance department also imposed a civil penalty of $100,000, the maximum allowed under Illinois law.

To read the insurance department’s announcement, click here. To read the SEC’s complaint from earlier this year, click here.