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The Securities and Exchange Commission (SEC) has filed suit and obtained Final Judgement against The Spangler Group, Inc. (“Spangler Group”) and Mark Spangler, a Seattle, Washington investment adviser who allegedly defrauded clients by secretly investing them in Mr. Spangler’s risky start-up companies. Mr. Spangler also allegedly used client money for his own benefit even though the investments were inconsistent with the investment strategies he had promised his clients and contrary to his clients’ stated investment objectives.

According to the SEC Mr. Spangler and the Spangler Group raised over $56 million for several private funds that Mr. Spangler created and owned. The SEC claims Mr. Spangler advised that the funds would invest in publicly traded securities, but instead he liquidated the private funds positions, and funneled the proceeds primarily to two private companies for which Mr. Spangler served as Chairman and, at times, Chief Executive Officer.

The SEC claims that in 2011, Mr. Spangler invested approximately $47.7 million of fund assets in the two private companies. According to the SEC, Mr. Spangler invested almost $42 million into just one of the private companies. From 2005 until April 2011, the private companies paid the Spangler Group $830,000 in fees for “financial and operational support” not actually rendered. The SEC alleged that those fees were hidden from clients who invested in the funds. According to the SEC, Mr. Spangler concealed the fraud for years and the scheme did not unravel until the summer of 2011 when the private funds were not able to satisfy redemption requests.

On June 3, 2015, the SEC obtained Final Judgement against Mr. Spangler and the Spangler Group for violations of the antifraud provisions of the federal securities laws. In addition, the U.S. Attorney’s office also filed criminal charges against Mr. Spangler and he was convicted of 32 counts of wire fraud, money laundering and investment adviser fraud. Mr. Spangler has been sentenced to 16 years in prison and ordered to pay nearly $20 million in restitution to his former investment clients.

Attorney Pearce began his career at the SEC as an enforcement attorney more than 40 years ago. His SEC defense law practice clients have included public companies and their officers and directors, broker-dealers, investment advisors, and individuals being investigated in connection with their personal securities transactions. He has broad, extensive experience in matters arising from alleged 10b-5 fraud violations including, “insider trading,” Section 16(b) “short swing profit,” and Section 14 “proxy rule” violations as well as Section 9 “market manipulation” cases.

Have you have been contacted by the SEC or believe that you may be subject of an investigation? If so, call Mr. Pearce at the Law Offices of Robert Wayne Pearce, P.A. for a free consultation. Mr. Pearce defends various entities and individuals who may be the subject of an SEC investigation or enforcement action regarding their alleged involvement in securities laws violations.

This Investors’ Rights blog post is by the Law Offices of Robert Wayne Pearce, P.A., located in Boca Raton, Florida. For over 40 years, Attorney Pearce has tried, arbitrated, and mediated hundreds of disputes involving complex securities, commodities and investment law issues. The lawyers at our law firm are devoted to representing investors and financial industry professionals throughout the United States and internationally! Please visit our website, www.secatty.com, post a comment, call (800) 732-2889, or email Mr. Pearce at pearce@rwpearce.com for answers to any of your questions about this blog post and/or any related matter.

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Robert Wayne Pearce

Robert Wayne Pearce of The Law Offices of Robert Wayne Pearce, P.A. has been a trial attorney for more than 40 years and has helped recover over $125 million dollars for his clients. During that time, he developed a well-respected and highly accomplished legal career representing investors and brokers in disputes with one another and the government and industry regulators. To speak with Attorney Pearce, call (800) 732-2889 or Contact Us online for a FREE INITIAL CONSULTATION with Attorney Pearce about your case.

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