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Two insurance agents face dozens of fraud charges

On Behalf of | Sep 22, 2021 | Felonies |

Two insurance agents from Newport Beach now face a total of 64 individual cases of fraud totaling more than $10 million after they were discovered using high risk investments to steal money from some of their wealthy clients.

The pair were first arrested on Nov. 24, 2020 on allegations of securities fraud and burglary involving more than $4 million. Additional charges were filed by the California Department of Insurance announced additional charges. A final round of charges was filed against the suspects last week. In total, one of the agents is facing 64 felony securities fraud charges, and the second agent is charged with 29 felony securities fraud violations and six charges of residential burglary.

The alleged scheme

An investigation by the California Department of Insurance alleges that the two men, Robert Lotter and Charles Major, fraudulently solicited and sold stock in two companies founded by Lotter. The companies used the names eAgency, Inc. and Mymobilewatchdog, Inc. After the first round of arrests and charges became public, other customers of the pair contacted the Department of Insurance to report additional allegations of fraud and theft. The two men were employed by Lotter’s insurance agency, R.A. Lotter Insurance Marketing, Inc. Lotter also owns he TDS Group, a 403(b) Plan Administrator for school districts throughout California.

The nature of the fraud

The essential gravamen of the fraud allegations asserts that Lotter and Major, using various unlawful method to obtain client financial information, contacted wealthy customers of Lotter’s insurance agency and used different fraudulent schemes to persuade then to invest in one or more of Lotter’s companies.

The two men are alleged to have withheld information about the companies’ prior financial histories, including the companies’ failure to pay financial obligations who had made prior investments with the firms. The two suspects are also charged with failing to inform investors when the supposed promising investment vehicles failed.

The suspects in this case are facing very serious criminal charges. If convicted, each of them may face an extended period of incarceration, financially onerous obligations to repay stolen funds, and fines. Anyone facing similar charges may wish to consult an experienced criminal defense attorney for an evaluation of the evidence and assistance in defending against the claims if the cases go to trial.