"For nearly 100 years investment firms have sought to address the average investor's goals with simplistic and inefficient mutual funds, or expensive and highly inconsistent stock picking. For more information, please see www.hercules-investments.com, Media Contact: Matt Yemma Peaks Strategies 909-633-9396 [emailprotected], Cision Distribution 888-776-0942 The complaint also alleges that McDonald commingled the investor funds with Herculess assets and his personal assets, and used $440,000 of those funds for personal expenses, including to pay his personal credit card bills. Now, there are a handful of companies that have flourished in the Covid era, but its a handful of companies. According to the. 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. $0 BAHAMAS 386 (SG458) - Alexander Graham Bell (pb10456) Stamps Caribbean Bahamas (1973-Now) or redistributed. These filings are called "notice filings". Today, his ambition is to own a NFL team. My dream was always to play in the NFL and thats going to be my ticket. We want to hear from you. [Like this article? Hercules Investments chief investment officer James McDonald used to be a familiar face on CNBC, pontificating about market matters as an expert thereon. Legal Statement. To be clear, you expect a risk event this year will take the Dow down to 15,000 but by year end it will finish higher than today? No, Brent Kovars mother didnt have an artificial intelligence supercomputer in her basement, the SEC says. This funds fees accelerate when its performance accelerates. But stimulating growth is impossible if the economy isnt open. We represent investors in claims against negligent brokers and brokerage firms. In a parallel action, the United States Attorneys Office for the Central District of California announced criminal charges against McDonald. Hercules Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. In this episode, David Armstrong, editor-in-chief at WealthManagement.com, talks to Hercules Investments James McDonald. So, I got to root for Tom Brady because any 40-plus football player is one I admire. With this risk in the market, many individual investors have to count on either continued paid stimulus or continued paychecks and loans for small business relief. Our emphasis is on index options investing around the U.S domestic large indexes, specifically, the S&P 500, the Russell 2000, and Nasdaq 100. The economy is slowly reopening and more vaccines are reaching people. He appeared as a financial expert on TV. The SEC further alleges that, from February 2021 to October 2021, McDonald raised $1.5 million through the sale of equity investments in Herculess business. Our employees and their family members enjoyed a wonderful time together this morning at PureTrack in Anaheim, CA! Hercules' portfolios are designed to achieve aggressive gains whether markets are rising or falling. But I think that the market will rebound and potentially finish the year slightly higher. According to the complaint, McDonald falsely represented that investor funds would be used to expand Hercules's business, lied about the firm's financial condition, and failed to disclose that he had promised Hercules clients that the firm would repay earlier losses. The SECs complaint charges McDonald 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. "-Sonn Law Group Client. GESCO is a security company operating in various fields and basing on the principle of physical protection. Unless you are aiming for simultaneous knocks on the door from the FBI, SEC and CFTC. We had to save the economy from going off the cliff with us not being able to operate as normal," McDonald said. The stockbroker and investment fraud lawyers at Sonn Law Group dedicate their entire practice to protecting the interests of investors who have lost money as a result of the negligent or wrongful conduct of those entrusted with protecting and growing our money. Our ability to monetize volatility is exceptional as evidenced by our winning WealthManagement.coms 2020 Wealthies Award as top Alternative Asset Manager. McDonald also allegedly raised over $3.5 million for securities trades through the Index Strategy Advisors Fund and misappropriated half of the funds for personal expenses. Of course, we know that theres tremendous risk, not just to our health, but to the sustainability of small businesses, to the credit and economic security of households and to the outlook for how we will move forward past the pandemic. And debt has spiraled over 50% higher to GDP than where we were last year this time. Describe the ideal client profile. And this is evidenced by us being at valuation levels weve never touched before, even higher than 1929 and 2000-2001. What should advisors know about your firm and how you can help them? The SECs complaint alleges that McDonald raised over $3.6 million from investors between May 2019 and October 2021, which he told investors would be used to trade securities through an investment vehicle called the Index Strategy Advisors Fund. This case was filed in Los Angeles County Superior Courts, Norwalk Courthouse located in Los Angeles, California. In fairness to James McDonald, television is a much more welcoming venue than an SEC hearing room or courthouse. Founded on May 26, 2005, GESCO provides private and corporate security services in various regions of the country including Baku, in accordance with the requirements of ISO 9001, ISO 14001, ISO 45001. Lets start with your macro view. You can reach us by phone at 844-689-5754 or via e-mail. Each client and each clients case is unique, and no result or outcome is or can ever be guaranteed. How does it factor into your life? 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. Required fields are marked *. I really enjoyed speaking with you and appreciate you taking the time. James McDonald from Hercules Investments and James Camp, Eagle Asset Management director of strategic income and managing director of fixed income, discuss the impact of the $1.9 trillion. The information provided in this website is offered for general information purposes only; it is not offered as and does not constitute legal advice in any way. And while recognizing that each investors needs are distinct, on balance what percentage of a portfolio should this comprise? A Division of NBCUniversal. With interest rates so low, what do you make of the TINA argument, which asserts there is no alternative to stocks? I use this blog to bring attention to regulatory filings involving financial advisors, current events in securities and cases in the financial services industry, and to help investors understand their rights and options for financial recovery. In this virtual event, McDonald shares: - Why the markets are too optimistic about the Covid-19 vaccine 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 dangers of too much fiscal and monetary stimulus I'm Jeff Sonn, an attorney concentrating on securities fraud and consumer class actions. The affidavit of service states that the summons and complaint were served on James McDonald by service to Beatriz Lima, "as person in charge of the place of business / authorized to accept service on behalf of Hercules Investments, LLC, a California limited liability company at 1718 18 Harriman Lane, #A, Redondo Beach, CA 90278." In summary, NFLHX provides direct access to risk hedged growth adding a layer of insurance to a portfolio that has appreciated with the market. Prominent in independent film, he has also worked in blockbuster films of varying genres, and has accrued a worldwide box office gross of over 1.9 billion USD.He has received various accolades, including a Golden Globe Award, and nominations for two Academy Awards and a BAFTA Award.. Born and raised in Canada, he rose to . Do you have your eyes on any team per se? Mr. McDonald previously was CEO/CIO of Index Strategy Advisors Inc. (ISA) from 2010-2019. Below are the states with which the firm you selected makes its notice filings. The leader of Pershing X explains why her experience, leadership style, and the support of BNY Mellon, have positioned the new venture to disrupt how wealth managers do business. (Jun 1986 - Sep 2016) 101 Royal Park Dr. Oakland Park, FL 33309. Wealth Management is part of the Informa Connect Division of Informa PLC. First, between May 2019 and October 2021, McDonald, through his control of Index Strategy Advisors, Inc. ("ISA")-an unregistered investment adviser-solicited over $3.6 million from approximately 20 investors for ISA's index hedge fund, the ISA Fund. Unlike hedge funds, however, a mutual fund is accessible to individual investors and their advisors in a very transparent package. Previously, McDonald was of counsel to Gary, Williams, Parenti, Watson & Gary, P.L.LC. 2023 Informa USA, Inc., All rights reserved, In this episode, David Armstrong, editor-in-chief at. Quant Research-Driven Investment Strategies For Investors Seeking Active Portfolio Management. AssetMark CEO Charles Goldman tells RIA Intel that he is focused on acquisitions, helping advisors, and the long term. Employment levels have increased slightly, but we are artificially keeping our economy going with stimulus checks and obviously all of the Feds actions. And so, we had that crash and then the desire and the interest in moving back forward. Ryan Thomas Gosling (born November 12, 1980) is a Canadian actor. Meanwhile, sophisticated investors including institutional firms, insurance companies, and ultra-high net worth individuals have sought higher returns during growth phases and greater protection during recessionary phases by utilizing derivatives, particularly options," said James McDonald, who also serves as the firm's Chief Investment Officer. 2023 RIA Intel, an Institutional Investor Publication. Ainslie Simmonds Vision for Pershing X, a Startup Out to Replace Advisor Tech Stacks, Economist Jason Furman Explains How Inflation Snuck Up on Us and Whats Ahead in 2022, A Mountaineer CEO Talks Infinity Multiples, Thrill-Seeking, and How Advisors Need to Change, Modern Slavery Act Transparency Statement. James McDonald, CEO of Hercules Investments, is using equity index options to profit from an expected surge in volatility and market swings. This field is for validation purposes and should be left unchanged. The complaint also charges McDonald with violating Section 206(4) of the Advisers Act and Rule 206(4)-8 thereunder, which prohibit certain transactions by investment advisers. I think all the equity markets are so overstretched that when a risk element enters the market, the selling will be violent and accelerated. More on that later. Get James McDonald's email address (j*****@post.harvard.edu) and phone number (718848..) at RocketReach. Its clock-striking-midnight dealmaking time at the Justice Department. Scott Gamm If markets rise, our fund is managed to match or exceed that growth based on our ability to go long or short with index options. In late 2020, McDonald lost between $30 million and $40 million of Hercules client money after adopting "a risky short position" based on his wrong prediction that the stock market would drop because of the COVID-19 pandemic and the results of the U.S. presidential election, the U.S. attorney's office said. The attorneys at ChapmanAlbin are licensed to practice law in Ohio and Michigan. For a free consultation, please call us now at 866-827-3202or complete ourcontact form. We are partnering with Nasdaq to put Nasdaq 100 Volatility Index (VOLQ) into our portfolio in a way where investors who have realized great gains from tech can rest assured knowing that in the event of a potential market downturn, our fund will be able to sustain the impact of a declining market and should provide upside. "There's a disconnect between Main Street and Wall Street, but we had to do it. Believe It or Not, Its a Great Time To Be a Financial Advisor, Ares Strikes Deal for Office, Naming Rights at Los Angeles Tower, Musks Twitter Sells Off Coffee Makers, Neon Logo in Auction Blitz. Registered in England and Wales. Top Hercules Investments Employees James McDonald Chief Executive Officer. 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. 2023 FOX News Network, LLC. A conversation about economies, markets, wage inequality, Congress, crypto, and more. 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, authorities said. Thats my personal mission. We are able to provide uncorrelated growth, meaning our strategies do not depend on equity markets continuing to rise in order to accomplish gains. James Arthur McDonald Jr., 50, was charged with one count of fraud for bilking clients out of millions of dollars on Sept. 21, 2022. Its like a freight train that cant come to an exact halt without a crash. Number 8860726. 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. All rights reserved. [USA Today]. A man who ran two California-based investment companies and frequently appeared as a TV financial news analyst was charged Wednesday with securities fraud for allegedly bilking clients out of millions of dollars, federal prosecutors said. The 10 Best and 10 Worst States in Which to Retire in 2021, Im an Advisor. Lets call it artificial income and artificial credit for small businesses that are keeping the economy alive. Powered and implemented by FactSet Digital Solutions. Your email address will not be published. Subscribe to RIA Intels thrice-weekly newsletter and follow the publication on Twitter and LinkedIn. In late 2020, McDonald lost between $30 million and $40 million of Hercules client money after adopting "a risky short position" based on his wrong prediction that the stock market would drop. States in which to Retire in 2021, Im an Advisor criminal james mcdonald hercules investments wife against McDonald previously was founder and of... With you and appreciate you taking the time Stamps Caribbean BAHAMAS ( 1973-Now ) or redistributed year this time thereon... & amp ; Gary, P.L.LC criminal charges against McDonald simultaneous knocks on the principle of physical protection there... To stocks to operate as normal, '' McDonald said the door from the FBI, SEC and CFTC,. Charges against McDonald was founder and CEO of hercules Investments James McDonald to! And how you can help them however, a mutual fund is accessible to investors... 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