LOS ANGELES—A former University of California–Los Angeles (UCLA) decathlete has agreed to plead guilty to federal charges for raising more than $37 million from investors falsely told their funds would be used to finance companies marketing cannabis vape pens, federal prosecutors announced July 1.
David Bunevacz, 53 of Calabasas,who competed with the Philippines national team, agreed to plead guilty to one count each of securities fraud and wire fraud, according to his plea agreement filed Friday in Los Angeles federal court.
Bunevacz, who had been taken into federal custody since April 5, is expected to formally enter his plea in the coming weeks. The crimes each carry a penalty of up to 20 years in federal prison.
Bunevacz solicited investments in various businesses—CB Holding Group Corp. and CaesarBrutus LLC, among others—that he claimed were involved in the sale of vape pens containing cannabis products such as CBD oil and THC, according to the criminal complaint.
The defendant falsely told at least one investor he had a long-standing relationship with a Chinese manufacturer of disposable vape pens and he obtained “raw pesticide-free oil” that was sent to a “lab that infuses the flavors into the oil with our proprietary custom process that renders the vape flavoring smooth and discrete,” the complaint states.
Prosecutors alleged that Bunevacz also provided investors with forged documents, including bank statements, invoices, and purchase orders, to support his claims of the businesses’ success and the need for investor funds.
Instead of using the funds to finance business operations, Bunevacz misappropriated the majority of the funds to pay for his lavish lifestyle, “including a luxurious house in Calabasas, Las Vegas trips, jewelry, designer handbags, a lavish birthday party for his daughter, and horses,” according to an affidavit filed with the complaint.
He allegedly spent $8,143,500 at casinos, paid $218,700 to an event planner in connection with the birthday party, and bought a horse for $330,000. Some investor funds were allegedly used to repay earlier investors in a manner consistent with a Ponzi scheme, according to federal prosecutors.
Bunevacz’s blog touts his success as a former decathlete who competed for the Philippines and said his wife and daughter appeared in a reality television show, the affidavit states.
The investigation revealed that Bunevacz took efforts to conceal negative information from investors, such as his 2017 felony conviction for the unlawful sale of securities, prosecutors allege.
After one investor uncovered a civil lawsuit against Bunevacz, the defendant allegedly emailed a counterfeit version of the settlement agreement to falsely make it appear that he had been paid $325,000 as part of a settlement. In reality, it was Bunevacz who had agreed to pay $325,000 to settle the claim, according to the U.S. Attorney’s Office.
Operating through his cannabis companies, Bunevacz raised between $37.1 million and $45 million from more than 10 victim investors. He admitted to causing losses of at least $28.4 million, prosecutors said.