ALBUQUERQUE, N.M. — Joel McKay Hixon of Las Cruces and Dain Leslie Schult of Austin, Texas, were found guilty Friday in a Doña Ana County court of defrauding investors in a pyramid scheme promising to use investor money to promote “mom and pop” radio stations on the internet.
They were convicted of fraud over $20,000, securities fraud, conspiracy to commit fraud, sale of an unregistered security, and sale of
security by an unlicensed agent, state Regulation and Licensing Superintendent Marguerite Salazar said in a news release Monday.
“This verdict sends a clear message to other fraudsters out there that the state of New Mexico will not tolerate criminals preying on the citizens of New Mexico” she said in a statement.
Schult used his companies — American Radio Empire Inc. and American
Wireless and Entertainment Inc. — to recruit people like Hixon who had experience in the industry to solicit investments from friends, offering them future employment. Schult and Hixon told investors their money was in support of an initial public offering of Schult’s company and to buy smaller radio stations and put them on the internet, according to the release.
“Those who seek to raise money in New Mexico must follow the law or be held accountable,” said Securities Division Director Matthew Bouillon Mascareñas said in a statement.
A joint investigation by the Securities Division of the New Mexico
Regulation and Licensing Department, the Texas State Securities Board, and the Travis County Sheriff’s Office revealed that Schult was misappropriating investors’ money for personal use and to pay commissions to Hixon for his collaboration.