May 17 (Bloomberg) -- Mark Spangler, former chairman of the National Association of Personal Financial Advisors, was indicted on charges that he secretly diverted $46 million from investors to risky startup companies he co-owned.
Spangler, the Seattle-based head of Spangler Group and co-founder of Tamarac Inc. and TeraHop Networks Inc., told investors that their funds were conservatively invested in publicly traded companies and bonds, U.S. Attorney Jenny Durkan in Seattle said in a statement on her website. A federal grand jury today indicted Spangler on 23 counts of wire fraud, money laundering and investment adviser fraud, Durkan said.
The U.S. Securities and Exchange Commission said today it is suing Spangler. He is scheduled to appear in federal court in Seattle tomorrow.
Spangler, 57, established funds as early as 1998 to pool investor money and buy publicly traded stocks and bonds, Durkan said. He didn’t tell customers he was diverting significant amounts of money to Tamarac and TeraHop or disclose that he was involved in managing the companies and received payments from them, prosecutors said.
TeraHop, a Georgia company, is no longer in business. Tamarac, based in Seattle, provides software to financial planners.
Spangler cooperated with the government’s investigation, meeting with prosecutors and providing documents, said Jon Zulauf, his attorney.
“We are disappointed that charges have been filed,” Zulauf said in a telephone interview. The lawyer said he and his client will fight the charges.
The criminal case is U.S. v. Spangler, 12-133, and the SEC case is SEC v. Spangler, 12-856, U.S. District Court, Western District of Washington (Seattle)
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