AKRON, Ohio — A retired U.S. Navy officer defrauded fellow servicemen out of more than $300,000 in an investment fraud scheme, according to the U.S. Securities and Exchange Commission.
Retired U.S. Navy Chief Petty Officer Robert L. Murray Jr., a former North Canton employee, stole investor funds and violated anti-fraud and registration regulations, the SEC said in the lawsuit filed in Akron federal court.
Murray, 42, took some of the money meant for investment trading and used it on gambling trips to casinos in Cleveland and elsewhere. It also lost a “significant amount of money” in the GameStop “meme stock” wave in early 2021, the SEC said.
“Murray used the veneer of trustworthiness created by his service in the U.S. Navy” to carry out the scheme, according to the filing.
The lawsuit seeks a permanent injunction to prevent Murray from setting up an investment group. He also wants him to return any profits he received from the scheme. The SEC also wants a judge to impose a civil penalty.
Court records do not show an attorney for Murray, and attempts to reach him were unsuccessful. He asserted his Fifth Amendment right against self-incrimination during the SEC investigation, the filing said.
Murray carried out the scheme when he lived in North Canton and Chicago, but has since moved to Anchorage, Alaska, the filing said.
In 2020, Murray used a Facebook group called Goats, which contains more than 3,500 current and former naval officers, to post about his success trading options contracts during the height of the COVID-19 pandemic, according to the filing.
He also created a channel on the social media platform Discord where he posts options trading tips.
Murray used the following to recruit 44 investors — including some active-duty naval officers deployed overseas — who paid $355,000 to his investment group, called Deep Dive Strategies, LLC, which was formed in North Canton. He requested the funds from September 2020 to February 2021, according to the filing.
He lost almost all of his money within three months of his first trades, according to the filing.
Murray embezzled $148,000 by withdrawing money directly from the investment fund or sending the money to his personal bank account. Within three days of receiving the investors’ money, he used it not to trade, but to spend more than $600 at a jeweler.
Investigators also linked the large cash withdrawals to the casino’s records. On February 2, 2021, he withdrew $10,000 from the mutual fund account. Nine minutes later, he bought $10,400 in chips at a Cleveland casino, the filing said.
This happened several times at casinos in Indiana, Wisconsin and Ohio, according to the filing.
He misinvested the rest of the money, including in GameStop stock, the SEC said. In Murray’s latest investment, he “bet on extremely risky options contracts” that lost all their value within 24 hours.
By Jan. 23, 2021, Murray had lost all but the $161.98 he withdrew from the account on Feb. 4, 2020, the filing said. He left a dollar in the bill.
Murray stopped communicating with his investors and rejected all attempts by those trying to get their investment back or get an accounting of the funds.
In August 2021, he wrote to investors that he would return their investments, but never did.
“As a retired Navy chief, Murray knew and took advantage of the trust in Navy chiefs that is developed through service and special naval training,” the filing said.
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