On August 4, 2025, federal prosecutors sentenced James McDonald, the former CNBC financial analyst, to 60 months in prison.
McDonald previously pled guilty to one count of securities fraud. He was CEO of two California companies and frequently appeared on CNBC as a financial analyst.
In early 2021, McDonald solicited millions of dollars’ worth of funds from investors in the form of a purported capital raise for a company named “Hercules.” However, McDonald misrepresented how he and Hercules would use the investor funds. McDonald also failed to disclose material financial information concerning Hercules. The financials and representations of McDonald omitted massive losses previously sustained. But most of the funds did not go to Hercules. He stole most of those funds in various ways, including spending $174,610 at a Porsche dealership and transferring $109,512 to the landlord. His misdeeds are detailed in an SEC complaint.
Though a television personality, he is almost as well-known for being a fugitive. McDonald failed to appear before the United States Securities and Exchange Commission (SEC) in November 2021 to testify after allegations arose that he had defrauded investors and remained a fugitive until his arrest in June 2024 at a residence in Port Orchard, Washington.
This story serves as an example of how star power does not always mean you can trust the person with your money. We have seen similar abuse of stardom in our 20-plus years of representing investors.
This post is for investor education and is a comment on current events.
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