Investment Co. CEO Faces Up to Five Years
John J. Lawbaugh, the former chief executive officer of two Maryland investment companies, pleaded guilty to wire fraud, theft from a registered investment company and income tax evasion.”By abusing his authority as chief executive officer of two investment companies, Mr. Lawbaugh stole more than $1.2 million,” said U.S. Atty. Rod J. Rosenstein. “It is essential for us to protect investors in order to preserve public confidence in our financial markets.”
According to the plea agreement, Lawbaugh was the chairman of the board, chief executive officer and majority stockholder of 1st Atlantic Guaranty Corporation from 1997 and chairman and CEO of SBM Certificate Company from July 2000 until August 2002, when he was removed by each company’s respective board of directors.
Lawbaugh admitted that from August 1999 to October 2001, he misappropriated $1.26 million of 1st Atlantic and SBM funds and diverted those funds to unauthorized uses, including for his personal benefit and for the benefit of his family.
He faces up to five years in prison and a fine of up to $250,000.
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Tags: tax evasion, theft, wire fraud
