S.A. lawyer Robert J. Mueller faces criminal charges related to alleged Ponzi scheme.

San Antonio lawyer Robert Jeffrey Mueller, who landed in securities regulators’ crosshairs a few years ago for allegedly defrauding investors of millions of dollars to fund his lavish lifestyle and businesses including a pinball machine company, is now facing criminal charges.

A federal grand jury in San Antonio has indicted him on eight counts of wire fraud related to a scheme involving the purchase of life insurance policies.

The indictment says a large portion of the money invested by individuals was used to repay earlier investors their principal and interest — the hallmark of a Ponzi scheme.

RELATED: SEC: San Antonio lawyer used investment funds as ‘piggy bank’ to pay personal expenses, businesses

Each count of wire fraud carries a penalty of up to 20 years in prison and maximum $250,000 fine. Prosecutors intend to seek forfeiture of certain property from Mueller if he’s convicted.

Mueller is scheduled to make his initial appearance in court Tuesday morning before U.S. Magistrate Judge Henry Bemporad.

The indictment comes as the Securities and Exchange Commission is seeking a final judgment to collect more than $70 million in a civil action filed against Mueller in August 2021. That represents more than $52 million in ill-gotten gains, $16.6 million in interest and a nearly $2.3 million civil penalty.

The SEC accused Mueller of spending more than $1.5 million of investors’ money to pay for his second and third weddings, engagement rings and wedding bands for both wives, vacation cruises, his daughter’s private school tuition and a condo in Hawaii. All told, the SEC said at least 300 investors lost about $58 million. 

Mueller asserted his Fifth Amendment right against self-incrimination when an SEC lawyer asked him about his use of the funds’ assets to pay for his personal expenses, the agency said in its lawsuit.

Eleven of Mueller’s companies filed for bankruptcy liquidation in 2021, including three that the SEC wants to be held responsible with him for repaying the $52 million. The parent company was deeproot Funds LLC; many of his companies incorporated deeproot in their name.

Mueller’s lawyers in the SEC action didn’t respond to a request for comment. 

Mueller and his deeproot Funds “funneled more than $30 million” in investor funds to businesses he controlled, including a developer of pinball machines, the SEC said. In another lawsuit in bankruptcy court, trustee John Patrick ‘Pat’ Lowe alleged the pinball company was “doomed to fail from the start” because it was “never properly capitalized.” 

In a 2020 interview, Mueller said he chose San Antonio to launch deeproot Pinball LLC because he had spent most of his life here and because the Texas economy is favorable for pinball manufacturing and development.

Many of his alleged victims were retirees whom he persuaded to cash out their retirement accounts and annuities to invest in his funds, Lowe said in his complaint. His suit has been on hold pending the outcome of the SEC’s case.

Besides the Mueller lawsuit, Lowe filed about three dozen complaints against various parties to recover money for the bankruptcy estates. 

Many of the investors “suffered near total losses as a result of Mueller’s fraudulent actions,” the SEC said in a September court filing.

In June, Mueller and the SEC entered a settlement that was ratified by a court judgment, though the specific amounts that he and some of his companies would have to pay had not been determined.

U.S. District Judge Xavier Rodriguez earlier this year issued an order finding Mueller liable for the “negligent misappropriation of investor funds for his personal benefit.”

Mueller promoted two investor funds as “profit-generating investment vehicles” investing in life settlements, which involve individuals selling their life insurance policies for cash settlements while still alive, the indictment says. The funds would receive the face value of the policies upon the death of the insured. 

But the indictment says no life settlements were purchased after May 2017.

Rodriguez, who has been assigned Mueller’s criminal case, has yet to consider the SEC’s motion for a final judgment.

The State Bar of Texas has taken no disciplinary action against Mueller and he’s still able to practice in the state.