CHANDLER, Ariz. — A federal jury has convicted two East Valley men of securities fraud after they used their religious organization as a front to swindle money out of investors.
Jeffrey D. McHatton, 68, of Chandler and Robert B. Sproat, 60, of Mesa were found guilty last week of 10 counts of fraud for offenses committed between 2012 and 2014.
A third defendant, 56-year-old Robert Moss of Gilbert, pleaded guilty to being involved in the fraud before the case was taken to trial. He was sentenced to 30 months in prison.
Records show the three men were involved with The Fortitude Foundation, an Arizona-based nonprofit founded by "three men of God who were called with a Divine purpose to help heal the needy," public records show.
Investigators say the three men "promoted themselves as Christian businessmen of unquestionable integrity" as they were recruiting investors for overseas projects in Africa and the Philippines.
These ventures involved retrieving sunken gold from the depths of the sea and recovering valuable metals out of Central America.
Prosecutors say up to $1.2 million was fraudulently invested in these ventures and many of the targeted investors were elderly.
Before the case went to trial, the Arizona Corporation Commission's Securities Division conducted its own investigation into the Fortitude Foundation.
According to statements collected by ACC investigators, one investor who contributed $250,000 to TFF testified they invested because the foundation was presented as a Christian organization that would spend its profits on charitable works.
A Christian minister in Tempe also testified they invested in TFF because of its religious affiliations and promises to invest in humanitarian projects.
But investigators say a large portion of the investor funds were directed back to the defendants.
"The Division claims that once the investors' funds were received, Mr. Moss and Mr. McHatton misused the funds for their personal expenses," ACC records state.
The defendants are scheduled to be sentenced in federal court on Sept. 28.
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