Following the commencement of COVID-19, a former resident of Arcadia who frequently appeared as a financial commentator on CNBC was charged on Wednesday with misleading investors about the state of his financial firm and dangerous assets. It was charged with concealing the significant loss brought on by the -19 pandemic.
According to the prosecution, McDonald served as the CEO of the Redondo Beach-based Index Strategy Advisors Inc. and the Los Angeles-based Hercules Investments.
According to the US Attorney’s Office, 50-year-old James Arthur McDonald Jr., who is rumored to be hiding out, was charged with one count of securities fraud.
According to the US Attorney’s Office, McDonald’s clients of Hercules lost between $30 million and $40 million as a result of their unsuccessful “short” investment, which was caused by the commencement of the pandemic and the uncertainty surrounding the 2020 presidential election. The stock market will thereafter see a significant crash.
Prosecutors claim that McDonald’s received a $675,000 investment from a victim group in March 2021, but that the company misappropriated the money by paying $109,000 to the home’s landlord and spending $174,000 at a Porsche dealership. was paying $6,800 for a rental in Arcadia. website for menswear.
Early in 2021, unable to collect user fees due to significant losses, McDonald’s started requesting additional investments; nevertheless, they allegedly made false claims about the use of the funds and the huge losses suffered by Hercules. omitted to reveal because to his “younger” position from the previous year.
Additionally, prosecutors contend that he misrepresented to clients that his firm, Index Strategy Advisors, was a registered investment advisor when, in fact, it had not been since 2019. Additionally, he allegedly supplied phoney account information to clients of that business. One of those clients allegedly invested $351,000 with the company, but when the investor tried to use the funds to purchase a home, they were lost, according to the prosecution.
In November 2021, McDonald was scheduled to appear before the US Securities and Exchange Commission, but he did not. He allegedly disconnected his phone lines, stopped using his email, and informed a man he meant to “disappear,” according to the prosecution.
A federal prison sentence of up to 20 years is possible for the securities fraud conviction.
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