The Securities and Exchange Commission yesterday filed a civil lawsuit against First Jersey Securities Inc. accusing the rapidly-growing securities firm and two of its top executives of illegal stock manipulation.

The complaint charges that First Jersey, its chairman Robert Brennan and broker Robert Berkson made more than $3 million by artificially inflating the price of shares of Geosearch Inc., a small oil and gas company.

The SEC complaint--the second major federal action against First Jersey--was filed in U.S. District Court in New York after a federal appeals court in Philadelphia rejected an attempt by First Jersey to prevent the SEC from issuing the complaint.

First Jersey had been fighting in court for months to block an SEC investigation into the Geosearch matter as well as a 1979 complaint about other alleged securities law violations by the firm. After a federal court in Newark refused in December to stop the SEC probe, First Jersey lawyers appealed to the 3rd Circuit Court of Appeals. Yesterday that court also refused to block the SEC.

First Jersey attorney Donald Robinson said yesterday he had not been notified of either the Philadelphia appeals court action or the SEC complaint in New York. He said, "the allegations will be vigorously contested, because, based on our investigation as counsel, they are untrue."

The SEC action was a major setback for First Jersey, an aggressively expanding brokerage firm that has 23 offices, including one in Fairfax.

Yesterday's complaint charges that First Jersey, Brennan and Berkson "used interstate commerce and the mails to employ manipulative devices and contrivances in connection with the purchase or sale" of stock.

The lawsuit alleges that while First Jersey was selling shares of Geosearch Inc. to its customers, it was simultaneously bidding to buy shares of the company and thus pushing up the price.

The complaint details a series of transactions during 1980 in which First Jersey bought and sold 1.6 million shares of Geosearch. The company bought some stock directly from Geosearch and related parties and then resold the shares to its retail customers.

Between mid-March and mid-September of 1980, Geosearch shares climbed from $3.50 a share to $13 7/8 a share in the over-the-counter market.

First Jersey sold almost 1 million shares of Geosearch to its customers during five days in April and on one day sold 510,000 shares of the company, which had only 250 shareholders before First Jersey became involved with it.

While First Jersey was selling the stock to its customers, it was also bidding to buy the shares in the over-the-counter market and was offering to pay higher prices than other brokers for the stock, the SEC said.

Brennan and Berkson knew that Geosearch "had nominal income and insubstantial revenues," the SEC charged. Geosearch specialized in filing protests against proposed federal oil and gas leases in hope of winning the leases for itself, the SEC said. The firm's president and controlling shareholder Alvin Abrams was cited by the SEC in 1970 for violating securities laws in connection with another firm, the SEC complaint said.

The complaint notes the Berkson, the First Jersey broker named in the complaint along with Brennan, was the subject of three government legal actions that led to convictions for securities fraud and filing false income tax returns.