header image

[Sign Up Now] to Receive Our FREE Daily SCVTV-SCVNews Digest by E-Mail

Inside
Weather
Santa Clarita CA
Clear
Clear
72°F
 
Calendar
Today in
S.C.V. History
January 17
1994, 4:31 a.m. - Magnitude 6.7 Northridge earthquake rocks Santa Clarita Valley [video]
bridge


The Securities and Exchange Commission has charged a Newhall-based investment advisory firm, Criterion Wealth Management Insurance Services, Inc., and its former owners, Robert A. Gravette and Mark MacArthur, both graduates of The Master’s College (now The Master’s University), with defrauding clients in a $16 million investment scheme from 2014 to 2017.

MacArthur is one of four sons of Dr. John F. MacArthur, Chancellor Emeritus of The Master’s University. The elder MacArthur was president of TMU from 1985 until he “transitioned” to his present role at the end of June 2019.

The SEC complaint, a civil enforcement action filed in the U.S. District Court for the Central District of California, alleges that Criterion and then-co-owners Gravette and Mark MacArthur breached their fiduciary duty and defrauded their advisory clients by failing to disclose significant financial conflicts of interest when recommending investments in private real estate investment funds, or REITS.

criterion wealth management - robert a gravette

Robert A. Gravette. | Photo: Criterion Wealth Management Insurance Services.

The complaint alleges that Gravette and MacArthur recommended that their advisory clients invest more than $16 million in four private real estate investment funds without disclosing that the fund managers had paid the pair more than $1 million, which was on top of the fees the defendants were already charging their clients directly.

The complaint further alleges Gravette and MacArthur were motivated to keep their clients invested in the funds, rather than allocate their capital elsewhere, because the additional side compensation was recurring and depended on Criterion’s clients remaining invested.

For two of the funds, this undisclosed compensation arrangement resulted in investment losses for the defendants’ advisory clients.

For those alleged actions, the SEC’s complaint charges Criterion, Gravette and MacArthur with violating the antifraud provisions of Sections 206(1) and 206(2) of the Investment Advisers Act of 1940.

The SEC’s complaint further charges Criterion and Gravette with violations of Section 207 of the Advisers Act, and Criterion with violations of Section 206(4) of the Advisers Act and Rule 206(4)-7 thereunder.

criterion wealth management - mark macarthur

Mark MacArthur, former co-owner, Criterion Wealth Management Insurance Services. | Photo: via LinkedIn.

The complaint also charges Gravette and MacArthur with aiding and abetting Criterion’s violations of Sections 206(1) and 206(2) of the Advisers Act and Gravette with aiding and abetting Criterion’s violation of Section 207 of the Advisers Act.

“The SEC seeks permanent injunctions prohibiting future violations of the federal securities laws and an order requiring defendants to disgorge their ill-gotten gains with prejudgment interest thereon, and imposing civil penalties,” the complaint reads.

The Defendants
Criterion is a California corporation with offices at 23504 Lyons Avenue, Suite 107, in Newhall that offers discretionary asset management services.

Until September 26, 2018, Criterion was registered with the Commission as an investment adviser. Criterion is currently registered as an investment adviser in California and Idaho, according to the SEC complaint.

Gravette, age 54, resides in Santa Clarita. At present, he is the sole owner and president of Criterion. From 2014 through 2017, Gravette and MacArthur were 50/50 co-owners of Criterion, and Gravette was Criterion’s chief compliance officer.

Gravette has been a registered representative of the broker-dealer at which Criterion investment advisory clients opened brokerage accounts since November 2006. Gravette holds FINRA Series 7, 24, 63, and 65 licenses.

MacArthur, age 52, resides in Newhall. His father, Dr. John F. MacArthur, married wife Patricia in 1963, according to public records.

Mark MacArthur played baseball while attending The Master’s University, and graduated in the class of 1990. He was inducted into the Master’s Hall of Fame in 2010.

“After graduating with a degree in Communication, he was drafted by the St. Louis Cardinals in the eighth round of Major League Baseball’s First-Year Player Draft,” MacArthur’s Hall of Fame webpage entry reads. “He spent two years in the Cardinal organization before moving on to Minnesota where he spent one season (1992) before ‘hanging them up’ for good.

“MacArthur moved back to the Santa Clarita Valley in 2003. … A year later, he founded Criterion Wealth Management with TMC alum Bob Gravette,” the bio reads.

From 2004 to mid-2016, MacArthur was Criterion’s co-owner and chief investment officer. In June 2016, MacArthur became an independent contractor for, but remained associated with, Criterion.

At present, MacArthur is the president, managing member and chief compliance officer of a state-registered investment adviser, M2 Financial LLC, which he formed after leaving his employment with Criterion in mid- 2016.

Like Gravette, MacArthur has been a registered representative of Broker-Dealer since November 2006. MacArthur holds FINRA Series 7, 24, 63, and 65 licenses.

Robert Gravette’s Twitter feed’s second to last entry, on April 28, 2017:

The Master’s University is also in the news this week as the school sought and received a two-year extension for a subdivision project from the Santa Clarita Planning Commission on Wednesday.

The SEC’s investigation was conducted by DoHoang T. Duong and supervised by Spencer Bendell of the Los Angeles Regional Office. The examination that led to the investigation was conducted by Kelly Kibbie and supervised by Kent Woo and Sang W. Lee.

The case was filed as Securities and Exchange Commission v. Criterion Wealth Management Insurance Services, Inc., Robert Allen Gravette, and Mark Andrew MacArthur, No. 2:20-cv-01402, in U.S. District Court for the Central District of California on February 12, 2020.

The litigation will be led by Donald W. Searles and supervised by Amy J. Longo.

Comment On This Story
COMMENT POLICY: We welcome comments from individuals and businesses. All comments are moderated. Comments are subject to rejection if they are vulgar, combative, or in poor taste.
REAL NAMES ONLY: All posters must use their real individual or business name. This applies equally to Twitter account holders who use a nickname.

7 Comments

  1. John Harambasic says:

    Sorry, Mr. Peeples. Discerning readers of your op-ed piece here can’t escape your veiled anti-Christian bias baked in. By including non-related references to Mark MacArthur’s father, his former college, whom his father is married to and when, placing a simple word “transitioned” in quotes, and citing an entirely unrelated sidenote regarding a 2-year extension for TMU’s subdivision project, you’ve revealed your own personal bias towards the institution of Master’s College and its President, Dr. John MacArthur, as opposed to a bona fide reporting of a criminal act by a relative.

    Gravette and MacArthur would have graduated college some 30 years ago, and Mark MacArthur’s degree has nothing to do with Christian ministry. Were the perpetrators of this crime graduates of USC, or UCLA or COC – would that have been as relevant to your story as TMCU is? Would another man’s father be as “relevant” – say, if the father were a senior editor at SCV News, or a local leader in the LGBQT community for example? I don’t think so.

    Mark MacArthur and Mr. Gravette are fully grown, adult men who have complete capacity – like all men (including yourself) to make moral and/or sinful choices in life. These aren’t collegians caught cheating on a college exam. If you don’t already, you may someday have a son or daughter who make equally bad choices in their late 40s resulting in criminal indictment. Do you want the reporter of that story making sure his or her readers know you’re the parent of that person? How about your wife – the mother of your children? Would she too wish to be tossed into the fray by affiliation alone, thanks to an overzealous reporter looking for a TMZ-style “gotcha”?

    Sadly, Mark MacArthur and his business partner succumbed to the temptation Christians know as the love of money – also known as idolatry in the Faith, and conspired to do wrong by people who trusted them with their treasure. That fact has absolutely NOTHING to do with Dr. John MacArthur (i.e., who he is and what his roles are in the church and college he presides over), or Master’s University (who don’t offer degrees in fiduciary crime), or Patricia MacArthur, or anything or anyone other than themselves. If you believe otherwise, you owe it to your readership to disclose why and how.

    Thankfully, there are a large number of mature adults and Christians in the SCV who know how to differentiate the truth from the hype, and Dr. MacArthur and TMU are held in high esteem and will continue to be, regardless of the crime being reported here. Should the day come when Dr. MacArthur himself, or Master’s University is equally complicit in some felony, that would be the appropriate time to bring them into the story.

  2. jim says:

    Wow! You seem to be taking this personally, or for some other reason. In my reading the story, I never assumed that TMC or anybody else was involved in any (alleged) criminal or moral crimes.

    Just the two individuals named in the story.

    Had this story reported/mentioned COC or CSUN instead of TMC would you have responded in the same way?

  3. Robert James says:

    “Dr. Macarthur is held in high esteem?” and shouldn’t be smeared by his son’s criminal activity?

  4. Robert says:

    Mark Macarthur has been for years a Director of his father’s Grace To You. This is a “Christian” non-profit organization which in has given millions of dollars (donated by Christians) to Kory Welch’s private company. Kory Welch is John Macarthur’s son-in-law and Mark Macarthur’s brother in-law. In another conflict of interest John Macarthur made sure that Kory Welch wrongly profited from TMU. John Macarthur held in high esteem? He’s basically the head of a crime family. BTW, Macarthur admits in his biography that he was at the Lorraine Motel on the same day MLK was killed in 1968!! Why was he really there?

  5. Barbara says:

    John MacArthur is a false teacher of works-based Lordship Salvation. It is estimated that he earns approximately $2 million per year from salaries at Grace Community Church, Grace to You, The Masters University, several organizations, book royalties and speaking engagements. (There is evidence that his books are written by others.) Not to mention that Masters University is on probation for MacArthur’s financial scams, conflicts of interest and abuse of students. And why was John MacArthur at the Lorraine Motel when Dr. Martin Luther King was assassinated and why was he arrested shortly thereafter? Why aren’t the police records of his arrest available?

  6. Robert says:

    Barbara, You ask a good question: “Why aren’t the police records of his (John Macarthur’s ) arrest available?” Phil Johnson, the head of Macarthur’s Grace To You and his minister of propaganda, in an effort at damage control, stated that Macarthur was arrested shortly after the MLK assassination for “preaching the gospel.” Needless to say, no one believes this is true, but what else could Johnson say given that Macarthur employs him?

  7. Barbara says:

    John MacArthur was arrested for “preaching the gospel” in Mississippi in 1968? Billy Graham preached the gospel in Mississippi and other states in the Deep South, known as the Bible Belt, in the 50s through the 70s. Billy Graham was never arrested for preaching the gospel, so what was the real reason MacArthur was arrested?

Leave a Comment


Latest Additions to SCVNews.com
1994, 4:31 a.m. - Magnitude 6.7 Northridge earthquake rocks Santa Clarita Valley [video]
bridge
1926 - Newhall Community Hospital, est. 1922, opens in larger, more modern hospital building at 6th & Spruce streets [story]
Newhall Community Hospital
The death toll from the novel coronavirus pandemic surpassed 2 million on Friday and the World Health Organization warned the global health crisis may get even worse as people weary of restrictions let down their guard and contagious strains of the virus spread around the globe.
Pandemic Death Toll Hits 2 Million Worldwide
At least once a month, residents of the Cali Lake RV community, nestled in a quiet canyon off a rural part of Soledad Canyon Road, have had their power shut off due to Southern California Edison’s Public Safety Power Shutoffs.
Residents Mostly Impacted by Power Shutoffs Express Concern Over Ongoing Events
Late Friday afternoon, a group of parents and student-athletes gathered in front of the William S. Hart Union High School District office to urge the district to bring athletic-conditioning back to school campuses.
Parents, Student-Athletes Gather to Urge Hart District to Bring Athletics Back
A future open space trailhead in the Tesoro area will be named after a founding Santa Clarita city councilman, and a portion of land in Newhall after a family who has donated several acres of land to the city for open-space preservation.
City Council OKs Dedications in Tesoro Area, Newhall Pass Open Space
The Los Angeles County Department of Public Health on Friday confirmed 258 new deaths and 15,051 new cases of COVID-19 countywide, with cases likely to reach over 1 million this weekend. In addition, the Santa Clarita Valley has reached 21,189 total cases.
Friday COVID-19 Roundup: Cases Near 1 Million Countywide; 258 New Deaths in County
Jim and Anita Lombardi of Federal Escrow, Inc. donated $50,000 to the Boys and Girls Club to help the organization continue providing COVID-19 relief services in the Santa Clarita Valley.
SCV Boys and Girls Club Receives $50,000 Financial Gift from Federal Escrow, Inc.
The Castaic Union School District governing board appointed a new president during its annual organizational board meeting last month.
CUSD Board Appoints Mayreen Burk as New Board President
The California Supreme Court declared Thursday that worker classification standards set forth in its Dynamex decision should apply retroactively to a labor class action from 15 years ago, as well as all non-final cases that predate the 2018 landmark ruling.
California High Court Makes Landmark Independent Contractor Ruling Retroactive
Los Angeles County officials announced five additional mass-vaccination sites set to open next week which include Six Flags Magic Mountain and California State University, Northridge.
Six Flags, CSUN Set to Open as Mass Vaccination Sites
Waste Management has extended its temporary residential green waste pick-up schedule for customers in Santa Clarita, with regular service anticipated to resume the week of Jan. 25.
Waste Management Extends Modified Green Waste Pick-Up Schedule
The College of the Canyons ‘Canyons Promise’ free tuition program for new students is now accepting applications for the 2021-22 year.
COC’s Canyons Promise Program Now Accepting 2021-22 Applications
The ice rink in Valencia, which the City acquired last year, is currently undergoing renovations prior to its highly anticipated grand reopening later this year.
Renovations for Highly Anticipated City-Owned Ice Rink Continue
The MAIN is set to host eight weeks of free virtual productions from around the world from Jan. 22 through March 12 via Zoom for the Stage on Screen Theatre Fest's International Edition of online theatre.
Jan. 22-March 12: The Main’s Stage On Screen Theatre Fest Goes International
1875 - Henry Mayo Newhall buys western half of the Santa Clarita Valley for $2 an acre [story]
Henry M. Newhall
The Los Angeles County Department of Public Health confirmed Thursday 287 new deaths and 17,323 new cases of COVID-19, with 20,918 total cases in the Santa Clarita Valley.
Thursday COVID-19 Roundup: County Surpasses 13,000 Deaths; SCV Cases Total 20,918
Henry Mayo Newhall Hospital announced Thursday the opening of its COVID-19 vaccine-distribution site, with the goal of vaccinating nearly 500 people a day.
Henry Mayo Announces Opening of COVID-19 Vaccine-Distribution Site
L.A. County Parks can help you achieve your New Year’s goals while bringing L.A. vibes into virtual classes.
Registration Open for L.A. County Parks’ Online Classes
Join the Santa Clarita Artists Association's first meeting of 2021, which will take place virtually Monday, Jan. 18, at 6:30 p.m.
Jan. 18: Artist Virginia Kamhi to Demonstrate Pastel Techniques
Get ready to get your game on Sunday, March 14, as Soroptimist International of Valencia presents their annual fundraiser to benefit the Soroptimist’s Dream Programs: Live Your Dream and Dream It, Be It.
March 14: ‘Games for a Cause’ Benefiting Soroptimist’s Dream Program
As the COVID-19 surge has continued to overwhelm hospitals over the past couple of months, it has also dramatically impacted the mortuaries where many of the pandemic’s victims end up.
Eternal Valley Struggles to Keep Up With Demand as COVID-19 Surges
The William S. Hart Union High School District governing board voted 4-1 to suspend small cohorts returning to campus through Feb. 8.
Hart District Votes 4-1 to Suspend Return to Campus Until February
The Santa Clarita Valley and surrounding regional areas fell under a red flag warning, prompting Southern California Edison to monitor more than 28,000 of its customers for potential power shutoffs through the remainder of the week.
SoCal Edison Considering Power Shutoffs Amid Red Flag Warning Conditions
%d bloggers like this: