William Dean Chapman, founder of a Reston-based financial firm, has been sentenced to 12 years in prison after pleading guilty to wire fraud according to the Associated Press.
Prosecutors said the Chapman, 44, founder of Alexander Capital Markets, which had offices at Plaza America, cheated investors out of more than $35 million.
Per the AP:
The Securities and Exchange Commission filed suit against Chapman, a Sterling resident, on Sept. 26.
The SEC alleges that "from at least June 2006 through June 2009, Chapman and the Alexander Companies raised money by inducing borrowers to transfer ownership of millions of shares of publicly traded securities to them as collateral for purported non-recourse loans based on false promises, including the promise to return the shares, or remit share profits in excess of accrued interest, to borrowers who repaid their loans."
The SEC believes that Chapman and his firm were doing "nothing to ensure their ability to repurchase and return shares to borrowers who elected to repay their loans, or remit share profits in excess of accrued interest to borrowers. Instead they used the proceeds to pay other borrowers, for operating costs, and for their own benefit."
It is also alleged that Chapman "fraudulently accepted" more than $2 million in loan repayments from at least two borrowers.
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