A former broker in Arizona, Robert Swagger, targeted and solicited Christian investors to raise money for a purported media company only to pocket the cash, according to the Arizona Corporate Commission, which is responsible for oversight of the securities industry in the state.
The commission last month found Swagger solicited investors through the Young Presidents Organization Christian Fellowship Network by posting the investment pool offering on its discussion board and by emailing members, according to a statement by the commission.
“However, Swagger failed to tell investors that he spent investor funds on personal expenses instead of investing the money into a streaming company for faith and family-friendly media projects,” according to the statement from Arizona's securities regulator, which was released November 21. He also spent the money on legal fees, credit cards, and membership dues, according to Arizona.
Swagger and two companies committed securities fraud and were ordered to pay $202,000 in restitution and a $25,000 administrative penalty, according to the Commission.
According to his BrokerCheck profile, Swagger was a registered broker from 1998 to 2009. He began soliciting investors in 2019 to join the investment pool, according to the Arizona cease and desist order.
“In 2019, the unidentified streaming company initiated a fundraising campaign that offered promissory notes in exchange for an investment of at least $500,000,” according to a news report by KTAR.com. “The notes would then be repaid at an interest rate of 6.25%.”
“Swagger then approached the company with the idea of gathering a group of investors who would pool their money to buy one of the notes,” according to the report. “The company agreed to the idea, and Swagger founded TRS PureFlix, a company that would manage the investments.”
“Swagger solicited investors through YPOCFN, a group comprised of presidents of various companies who are all Christian and under the age of 45,” according to the report. Between May 30 and June 18, 2019, he struck deals with three Christian investors for a total of $202,000.
His wife, Terri Lynne Swagger, as a controlling person of one company was ordered to pay $10,000 in restitution for the company’s securities fraud violations.
Swagger is also awaiting sentencing before the U.S. District Court for the District of Arizona after pleading guilty to federal wire fraud charges related to his conduct promoting the investment pool offering.
In settling this matter, Robert Swagger admits to the commission’s findings only for the purposes of this proceeding, according to the statement. Terri Swagger neither admitted nor denied the commission’s findings.
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