September 29, 2022

LOS ANGELES (AP) — A person who ran two California funding companies and continuously appeared as a monetary information analyst on tv was charged Wednesday with securities fraud for allegedly swindling thousands and thousands of {dollars} from purchasers, federal prosecutors mentioned.

James Arthur McDonald Jr., 50, has been charged with one depend of fraud and will withstand 20 years in jail if discovered responsible, U.S. Lawyer’s Workplace mentioned in a press release.

The assertion mentioned McDonald, who lived within the Los Angeles suburb of Arcadia, is allegedly in hiding. It was unclear whether or not he had a direct lawyer who may communicate on his behalf.

Prosecutors allege that McDonald hid enormous monetary losses from some prospects and used a part of the funding for private bills, spending a few of it at a Porsche dealership and an internet site that sells designer menswear.

McDonald was CEO of Hercules Investments LLC in Los Angeles and Index Technique Advisors Inc. in Redondo Seashore and appeared continuously as an analyst on monetary tv information community CNBC, authorities mentioned.

In late 2020, McDonald misplaced between $30 million and $40 million in Hercules consumer cash after it took a “dangerous quick place” primarily based on its misguided prediction of a inventory market decline as a result of COVID-19 pandemic and the US presidential election outcomes. That is reported by the US Lawyer’s Workplace.

In early 2021, McDonald “requested thousands and thousands of {dollars} in funds from buyers within the type of a proposed capital improve for Hercules, however misrepresented how the funds can be used and didn’t disclose the huge losses Hercules had beforehand incurred,” the assertion mentioned.

Additionally on Wednesday, the US Securities and Alternate Fee filed a civil lawsuit in opposition to McDonald and Hercules for violations of federal securities legal guidelines.

Subscribe to Fortune Options electronic mail checklist so you do not miss our most vital articles, unique interviews and investigations.


Leave a Reply

Your email address will not be published.