LOS ANGELES (AP) — A person who ran two California-based funding corporations and regularly appeared as a TV monetary information analyst was charged Wednesday with securities fraud for allegedly bilking purchasers out of thousands and thousands of {dollars}, federal prosecutors stated.
James Arthur McDonald Jr., 50, was charged with a single fraud depend and will withstand 20 years in jail if convicted, the U.S. lawyer’s workplace stated in an announcement.
McDonald, who lived within the Los Angeles suburb of Arcadia, is believed to be in hiding, the assertion stated. It wasn’t instantly clear whether or not he had an lawyer who might communicate on his behalf.
Prosecutors allege that McDonald hid huge monetary losses from some purchasers and used some funding cash for private bills, spending a few of it at a Porsche dealership and on a web site that sells designer menswear.
McDonald was CEO of Hercules Investments LLC of Los Angeles and Index Technique Advisors Inc. of Redondo Seashore, and regularly appeared as an analyst on the CNBC monetary TV information community, authorities stated.
In late 2020, McDonald misplaced between $30 million and $40 million of Hercules consumer cash after adopting “a dangerous brief place” based mostly on his improper prediction that the inventory market would drop due to the COVID-19 pandemic and the outcomes of the U.S. presidential election, the U.S. lawyer’s workplace stated.
In early 2021, McDonald “solicited thousands and thousands of {dollars}’ price of funds from buyers within the type of a purported capital increase for Hercules however misrepresented how the funds can be used and did not disclose the huge losses Hercules beforehand sustained,” the assertion stated.
Additionally on Wednesday, the U.S. Securities and Alternate Fee filed a civil criticism charging McDonald and Hercules with violations of federal securities regulation.
The Related Press
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