Arcadia Man Charged with Securities Fraud for Stealing Client Funds and Concealing His Investment Firms Massive Financial Losses [press release]He appeared as a financial expert on TV. Accordingly, the claim of 531.4 hours is insufficiently supported. Your activity looks suspicious to us. (Lindemann Decl. (See Hood v. Gonzales (2019) 43 Cal.App.5th 57, 71 [interpleader is an equitable proceeding where the conflicting claims regarding the interpleaded funds are resolved]. James Arthur McDonald Jr., 50, formerly of Arcadia and who is believed to be in hiding, is charged with one count of securities fraud, a crime punishable by up to 20 years in federal prison. Yet only 14.5% of the global market has been penetrated. Hercules Investments has named Loreal McDonald as corporate counsel and interim chief operating officer. However, there is no proof of service indicating that the supporting declaration, amended declaration, or proposed order were served on debtors. VS HERCULES INVESTMENTS, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, ET AL. Its clock-striking-midnight dealmaking time at the Justice Department. How To Invest In Bitcoin By Two Harvard Minds. 6,971 Number of Organizations $13.3B Total Funding Amount 1,202 Number of Investors. . 1,230 Number of Organizations $4B Total Funding Amount 434 Number of Investors. Charles Canter will lead the litigation. Hercules Investments, LLC, A California Limited Liability Company, et al., Court Case No. Hercules investments is an award-winning portfolio manager serving growth-focused individual. No credit card required. He appeared as a financial expert on TV. In late 2020, McDonald lost between $30 million and $40 million of Hercules client money after adopting "a risky short position" based . Our payment security system encrypts your information during transmission. Track. VS JAMES A. MCDONALD, JR., ET AL. 2 at 5.) Fri, Feb 12 20212:08 PM EST RELATED 00:00 James McDonald's advice to the. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. The SEC's complaint, which was filed in the Central District of California, charges McDonald and Hercules with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. No, Brent Kovars mother didnt have an artificial intelligence supercomputer in her basement, the SEC says. Opinions expressed by Forbes Contributors are their own. Some property owners may prefer this information be james mcdonald hercules investments net worth confidential, we are licensed to display information. Hercules Capital started at outperform with $17.50 stock price target at Oppenheimer. Chowthi said McDonald gave D.J. Investors should let a professional handle putting these trades on. He was named a "rising star"advisor in 2012 by ETF.com,frequently appeared on CNBC as a marketanalyst, including on Fast Money and The Exchange, and Hercules Investments won a WealthManagement.com Industry award in 2020 in the category ofAlternative Asset Management. Scott Gamm Given these circumstances, McDonald said, the S&P 500 could crash to 1,900 if investor sentiment suddenly turns negative. Ciaran McEvoy Now he's wanted on fraud charges. He last appeared on the network in July 2021. He then misappropriated those funds in various ways, including spending roughly $174,610 of them at a Porsche dealership. 5.) Houston, Texas, United States. McDonald was CEO of Hercules Investments LLC of Los Angeles and Index Strategy Advisors Inc. of Redondo Beach, and frequently appeared as an analyst on the CNBC financial TV news network,. ), While BNSK may have previously been in possession of funds that may be used to satisfy the judgment in plaintiffs favor entered in this action, the settlement funds from Herculess insurer have now been deposited into a court account, the allocation of which will be determined in an interpleader action. Our estimate is that stock prices need to come down 20-50% to reflect COVID-19-impacted U.S. economic activity. McDonald told Business Insider. According to the DOJ, McDonalds troubles began after taking risky short positions in 2020, betting that the U.S. economy, and the stock market,would crater due to the COVID-19 pandemic and the 2020 presidential election. McDonald, who faces up to 20 years imprisonment if convicted, is believed to be in hiding, the U.S. Attorneys office said in a news release. Brown, whose firm used to represent defendants on other matters seemingly related to this litigation but never actually appeared on behalf of defendants in this case. It can be difficult to enter a field/industry where no one whos winning the game looks like you but Lewis did it and I took notice. DocketUpdated -- James A. McDonald, Jr. (Defendant): Name Suffix changed from JR. to Jr. DocketUpdated -- Hercules Investments, LLC (Defendant): Organization Name changed from HERCULES INVESTMENTS, LLC, a California limited liability company to Hercules Investments, LLC, DocketCase reassigned to Stanley Mosk Courthouse in Department 72 - Hon. Proposed Intervenor Justin Bunnells Motion for an Order Granting Leave to Intervene is DENIED. CEVA Logistics. Assistant United States Attorneys Carolyn S. Small and Alexander B. Schwab of the Major Frauds Section are prosecuting this case. Full content visible, double tap to read brief content. The SEC's complaint alleges that McDonald raised over $3.6 million from investors between May 2019 and October 2021 for the stated purpose of trading securities through an investment vehicle called the Index Strategy Advisors Fund, and that McDonald used less than half those funds for trading and did not engage in any trading with the funds for long stretches of time. (See Ex Parte App. U.S. Attorney's Office, Central District of California, Environmental Crimes and Community Safety, Arcadia Man Charged with Securities Fraud for Stealing Client Funds and Concealing His Investment Firms Massive Financial Losses, Carson Man Sentenced to More Than 11 Years in Prison for Role in International Conspiracy to Launder Money Taken from Fraud Victims, Former MoviePass Executive Arrested on Indictment Alleging He Embezzled $260,000 from Employer to Repay Coachella Debt, Irvine Man Sentenced to 4 Years in Federal Prison for Fraudulently Obtaining $5 Million in COVID Loans He Spent on Sports Cars, Arcadia Man Charged With Securities Fraud For Stealing Client Funds and Concealing His Investment Firms Massive Financial Losses. The Securities and Exchange Commission today announced the filing of a civil injunctive action against James Arthur McDonald, Jr. and his SEC-registered investment adviser firm, Hercules Investments, LLC in connection with two fraudulent securities offerings. On February 15, 2022, creditors motion for order assigning right to payment was denied. The SECfiled a civil complaint today charging McDonald and Hercules with violations of federal securities law. Step 1) Become the best index options trader in the world, and I am very confident that today I have done that. James McDonald, CEO at Los Angeles-based alternative investment manager Hercules Investments has a trade which would profit from the stock market dropping back to March lows. McDonald: Conservative investors should move to money market funds or treasuries and wait for the crash to happen. According to the U.S. Attorney's Office, McDonald's . 4. Read more: BANK OF AMERICA: Buy these 26 cheap and fundamentally rock-solid stocks before the economic rebound sends them soaring in 2021. The $900 billion stimulus package is necessary and was largely expected by investors but it won't be enough to limit the economic fallout of the pandemic, according to McDonald. - Why volatility as an asset class is key for 2021, Its important for investors to be prepared for stock market volatility, as the economic outlook remains fragile in 2021, McDonald said. (Reply at 3.) The Dow Jones industrial average could drop to as low as 15,000, a roughly 50% drop from current levels, he added. Produce all communications (including e-mails, text messages, or messages from any messaging service) between Hercules Investments, LLC and Justin Bunnell. My intensity and competitiveness on the field is what makes me extremely effective as an investment manager. Instead, the SEC alleges, McDonald misappropriated more than $1 million of the funds for personal expenses, including luxury vehicles and paying rent on his home, and misappropriated more than $2 million of the funds for Ponzi-like payments, payments to his Hercules' investment adviser clients and expenses associated with operating Hercules. 2, 5 & Ex. 3.). To Chowthi, the evidence indicates that McDonald is currently intentionally concealing his whereabouts., https://www.wealthmanagement.com/sites/wealthmanagement.com/files/logos/Wealth-Management-Logo-white.png, Hercules Investments CEO/CIO James McDonald. James McDonald, the founder of the Los Angeles-based firm Hercules Investments, has profited from the market's recent volatility using stock index options. Plaintiff contends that the requested documents are pertinent to the efforts to collection on the judgment, including ascertaining available insurance and concerning the assets of judgment debtors Hercules Investments, LLC and James McDonald that are being held, obstructed, or concealed by third parties. James McDonald, the chief investment officer at Hercules Investments, told Business Insider that the news would be the catalyst for a protracted sell-off heading into the election.. A [Complaint in Interpleader].). An official website of the United States government. The stock market is a big auction house. The Adviser grants to the Trust a license to use the names "Hercules Investments" and "Hercules Fund" (the "Name") as part of the name of any Fund during the term of this Agreement. at 3.) Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor. Why is this public record being published online? Hercules and the various insureds settled claims for $1,450,000, which was directed by Hercules to be paid into a separate account maintained by BNSK and distributed at Hercules direction for (1) defense costs relating to claims by investors against Hercules for losses sustained as a result of Hercules investment strategies and/or (2) to pay claims by various investors relating to losses by such investors as established by the Settlement Agreement. (Brown Decl. The SEC's investigation was conducted by David S. Brown, Carol Kim, and Matthew O. Koop and was supervised by Marc J. Blau in the Los Angeles Regional Office. 21STCV19709 in the Superior Court of California, County of Los Angeles. That product for me ended up being index options. (whos only identified as suchin the complaint) a laptop and cell phone to secretly communicate with McDonald, as well as a thumb drive containing information about which clients were owed money. I knew from the first time I stepped on the field at 11 years old that I wanted to be an NFL linebacker; and today at 49 years old, I still wish I could play in the NFL! . However, the Court file reflects that counsel for creditor has remotely appeared for each hearing since entry of the judgment. That is fatal. If the stock market falls by say 20-40 percent, you can expect a vol instrument such as UVXY or VOLQ to gain 100-200% so purchasing long-dated call options on those vehicles could deliver gains of 10X the gains on the instrument itself. Hercules Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. They are part of the Executive team within the C-Suite Department and their management level is C-Level. Brief content visible, double tap to read full content. ciaran.mcevoy@usdoj.gov 312 North Spring Street However, interest is not the type of cost that can be claimed in this motion. Plaintiff Semyon Ginzburgs Motion for Order Assigning Right to Payment Due to Satisfy Judgment is DENIED. Instead, McDonald spent more than $1 million of the money on his own expenses, and used more than $2 million on Ponzi-like payments to Hercules clients and business expenses for the firm, according to the SEC complaint against him. McDonald could not be reached for comment. Registered in England and Wales. Unfortunately, according to the Justice Department and SEC, he didnt tell those new investors about all the money he lost on the election, nor precisely what he was going to do with it, as dropping $174K at a Porsche dealership and paying $110K to his landlord are not the same thing as launching a mutual fund. Actually, he didnt just assume it: He bet his clients money rather heavily on it, and lost them upwards of $40 million doing so. The supplemental declaration also attaches the referenced Settlement Agreement, but paragraph 5 of that agreement merely states: Defendants will give notice of this settlement to their E&O carrier. (Lindemann Supp. Indeed, such other claims may be substantial and the subject of an interpleader action in this Court. James McDonald is a 25-year veteran of the investment industry and was named one of America's top 10 investment advisors by ETF.com in 2012. Responsible for all Global Security Operations including loss prevention, investigations, emerging technology . For those willing to take risk and or those who dont want to liquidate their securities, we recommend buying volatility with a 10-15% allocation in their portfolio. By December 2020, Hercules clients were complaining to company employees about the losses in their accounts. Case Details Parties Documents Dockets. According to the complaint, McDonald also appears to have terminated his previous phone and email accounts and told one person that he planned to vanish.. that he was not going to stick around and that he would vanish, Chowthi wrote. Official websites use .gov James Macdonald will celebrate 62nd birthday on a Tuesday 4th of October 2022. McDonald an avid football enthusiast stated that he planned to launch a publicly traded mutual fund under the ticker symbol NFLHX. The losses to Hercules clients and the potential for litigation related to those losses jeopardized the success of that fund because any litigation would have had to be publicly disclosed. James McDonald, founder and CEO of Hercules Investments, has some advice for the next generation of Black Americans, "Go after what you want and be all that you can be." Tue, Feb 9. It looks like WhatsApp is not installed on your phone. Technology innovations are too powerful. The SEC alleges that McDonald, a former guest commentator on CNBC, raised more than $5.1 million from 23 investors and clients, and misappropriated more than $2.9 million of those funds for personal expenses and Ponzi-like payments to earlier investors. This is the best and simplest approach, but these securities should not be traded by novice investors. I became fascinated by the story of how junk bonds via Mike Milken and others were used to revolutionize financing and M&A during the 90s. Docket Updated -- Hercules Investments, LLC (Defendant): Organization Name changed from HERCULES INVESTMENTS, LLC, a California limited liability company to Hercules Investments, LLC 06/14/2021 Docket Case reassigned to Stanley Mosk Courthouse in Department 72 - Hon. Decl. McDonald: You have to follow the money. For the foregoing reasons, the motion is DENIED. Accordingly, to the extent that the post judgment enforcement proceedings in this case includes work on creditors ex parte application and motions, such work appears not to have been reasonable and necessary. Hercules Capital is the largest business development company focused on venture lending, and the lender of choice for innovative entrepreneurs and their venture capital partners. Lines and paragraphs break automatically. judy norton children; court ordered community service california He played for the Los Angeles Rams and Detroit Lions. keystyle mmc corp login; thomson reuters drafting assistant user guide. "There are going to be explosive opportunities for investors," says James McDonald, CEO of investment firm Hercules Investments on November 12. McDonald was the CEO and chief investment officer for two registered companies; Hercules Investments, based in Los Angeles, and Index Strategy Advisors, which was based in Redondo Beach. Suite 1200 Though McDonald did respond to some records requests, he failed to show on the scheduled date. But what really got my attention was the security that empowered Lewis to make history: junk bonds. And, now that you, the Justice Department and the SEC mention it, a lot of his stories sound a bit hard to believe. A frequent lecturer and conference speaker, he is a nationally-recognized expert on the topics of macroeconomics, event-driven investing, growth investing, portfolio construction, index investing, exchange-traded funds, digital currencies, and index . Shipping cost, delivery date, and order total (including tax) shown at checkout. Or does he seek to defend against plaintiffs claims against defendants through the filing of an answer in intervention? James McDonald, CEO and Chief Investment Officer of Hercules Investments, a Los Angeles-based Registered Investment Advisor, is hosting a virtual event, 'Preparing Investment Portfolios for a . For more information, please visit: https://hercules-investments.com/hercules-public/index.html, Media Contact Too many people and firms over-complicate these basic truths. Plaintiff and judgment creditor Semyon Ginzburgs Motion for an Order Awarding Post-Judgment Costs and Attorney Fees Incurred in Enforcing Judgment is DENIED. Led the design, development, and rollout of investment management, financial planning, and lending standards and practices to the bank's High Net Worth clients. Bunnells Motion for an order Awarding Post-Judgment Costs and Attorney Fees Incurred in judgment. Such other claims may be substantial and the subject of an interpleader action in this Court to read content. Payment was DENIED concealing his whereabouts., https: //www.wealthmanagement.com/sites/wealthmanagement.com/files/logos/Wealth-Management-Logo-white.png, hercules clients were to! 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