Mark MacArthur – son of prominent pastor and author John MacArthur – has been charged by the Securities and Exchange Commission for defrauding clients for $16 million in an investment scheme.
According to the SEC complaint, MacArthur, his former business partner Robert Gravette and the company they co-owned until MacArthur left between 2016 and 2017, Criterion Wealth Management Insurance Services, Inc., failed to disclose a financial conflict of interest while brokering an investment deal.
The complaint, which was filed on February 12, claims that MacArthur and Gravette encouraged advisory clients to invest more than $16 million in “four private placement funds” without disclosing that they had been paid a sum of more than $1 million of side compensation by the private placement fund managers.
Reportedly, the side compensation was reoccurring and hinged on the accused parties keeping clients invested in the funds. The SEC called the defendants’ failure to disclose this “glaring conflict of their financial interests” a “breach of their fiduciary duty.”
“Because this additional side compensation was recurring and depended on Criterion’s clients remaining invested in the subject funds, Criterion, Gravette, and MacArthur not only had a financial incentive to recommend that their clients invest in the first instance, they were also incentivized to keep their clients in the…
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