CEO of Suburban Pharmaceutical Company Sentenced to 4 Years in Federal Prison for Misappropriating $2.2 Million from Investors
CHICAGO — A federal judge today sentenced the former Chief Executive Officer of a suburban pharmaceutical company to four years in prison for pocketing $2.2 million from investors and spending the money on property in Michigan, golf and yacht club dues, and trading in options on futures contracts.
As the CEO of Neurendo Pharma LLC in Hoffman Estates, ROBERT TOMLINSON misappropriated the money from individual and corporate investors from 2014 to 2017. 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. Tomlinson 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 maintaining a personal property in Bay Harbor, Mich., and annual dues at the Bay Harbor Golf Club and Bay Harbor Yacht Club.
Tomlinson, 69, of Hoffman Estates, pleaded guilty earlier this year to one count of wire fraud. U.S. District Judge Rebecca R. Pallmeyer imposed the 48-month sentence in federal court in Chicago.
The sentence 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.
“Simply put, Tomlinson scammed for his own benefit without any regard for his investors, who trusted him with their funds to invest and use those funds to capitalize and fund the company’s operations,” Assistant U.S. Attorney Sunil Harjani argued in the government’s sentencing memorandum. “This was not a one-time mistake in judgment, but rather a calculated course of conduct with much aforethought.”
Evidence in the case revealed that Tomlinson misappropriated at least $100,000 in investor money to fund his own futures trading account, and $33,000 to make donations to the Washington National Cathedral. In addition to the Michigan property, Tomlinson used investor funds to make mortgage payments on a property in the Georgetown neighborhood of Washington, D.C.
When pocketing the money, Tomlinson made dozens of cash withdrawals of slightly less than $10,000 each from Neurendo’s bank account. The structured withdrawals were 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.