Frederick McDonald Jr., president and CEO of US Advisory Group Inc., is accused of lying to at least 100 investors to raise money for medical marijuana shops that never opened, the Boston Herald writes, citing the office of the Secretary of the Commonwealth William Galvin.
One 78-year-old California investor allegedly lost $3 million as a result of McDonald's recommendations, according to the complaint cited by the paper. McDonald also allegedly failed to disclose his controlling interest in the investment, and used the funds to pay for other outside business projects, the Boston Herald writes.
McDonald’s other companies include Kettle Black of MA and Commonwealth Pain Management Connections — for which Kettle Black was the main funding source between 2015 and 2017, Galvin’s office says, according to the paper.
The investment advisor and others allegedly hid information from investors and regulators in a separate cannabis-related project, which also failed, the Boston Herald writes, citing the complaint.
Galvin’s office is seeking to bar McDonald from practicing in the state as well as restitution to allegedly harmed investors and a fine, according to the paper.
A representative for US Advisory Group tells the Boston Herald that “news reports do not accurately reflect US Advisory Group’s core, history and legacy of providing exceptional financial planning and advice” and that the firm has “always acted with the highest level of ethics and in the best interests” of its clients, but declined further comment.
McDonald is still registered as an investment advisor with US Advisory Group, according to the SEC.
He was also a registered broker from 1981 until 2015, according to his BrokerCheck profile.
McDonald has three customer disputes on his BrokerCheck record dating back to 1999, with two of them settled and one still pending.