CEO of Suburban Pharmaceutical Company Arrested on Federal Fraud Charge for Allegedly Misappropriating at Least $1.5 Million from Investors
CHICAGO — The chief executive officer of a suburban pharmaceutical company was arrested today on a federal fraud charge for allegedly pocketing at least $1.5 million from investors and spending the cash on a luxury lake house in Michigan and golf and yacht club dues.
ROBERT TOMLINSON, the CEO of Neurendo Pharma LLC in Hoffman Estates, misappropriated at least $1.5 million from individual and corporate investors from March 2016 to earlier this month, according to a criminal complaint and affidavit filed in U.S. District Court in Chicago. Tomlinson fraudulently advised investors that their funds would be used to operate Neurendo and to market an experimental drug, known as GNTI, to treat type II diabetes, the complaint states. Tomlinson allegedly claimed investors would receive a substantial payment once Neurendo’s drug rights were purchased by a major pharmaceutical company. In reality, Tomlinson used the majority of investor funds to support his family’s lavish lifestyle, which included a lake house in Bay Harbor, Mich., and annual dues at the Bay Harbor Golf Club and Bay Harbor Yacht Club, the complaint states.
Federal agents this morning arrested Tomlinson, conducted a court-authorized search of his residence in Hoffman Estates, and seized funds in one of his bank accounts. Tomlinson, 68, is scheduled to make an initial court appearance today at 3:00 p.m., before U.S. Magistrate Judge Susan E. Cox in Chicago. The complaint charges him with one count of wire fraud.
The complaint was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation. The government is represented by Assistant U.S. Attorney Sunil Harjani.
According to the complaint, Tomlinson attempted to raise money from existing investors as recently as this month. Earlier this year he made approximately 47 cash withdrawals of $9,500 each from Neurendo’s bank account. The structured withdrawals appear to have been made in an effort to avoid federal reporting rules, which require financial institutions to notify the U.S. Department of the Treasury about transactions of more than $10,000, the complaint states.
The charges also accuse Tomlinson of misappropriating at least $100,000 in investor money to fund his own futures trading account, and $33,000 to make payments to the Washington National Cathedral. In addition to the Michigan lake house, Tomlinson used investor funds to make mortgage payments on properties in Petoskey, Mich., and the Georgetown neighborhood of Washington, D.C., the complaint states.
The public is reminded that a complaint contains only charges and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Wire fraud carries a maximum penalty of 20 years in prison. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.