Former talk show host Alan Christian, who tried to build a communications conglomerate on the good will of his listeners and $678,000 invested by about 900 Marylanders, was charged yesterday with fraudulent misappropriation of funds and with violation of the Maryland Securities Act.
The charges were filed in Baltimore Circuit Court after a lengthy criminal investigation conducted by the office of Attorney General J. Joseph Curran Jr. Mr. Christian's associate, Grace M. Starmer, was charged with the same crimes.
The charges are based on solicitation of investments in 1988 and for Atlantic Coast Radio Inc., a company formed by Mr. Christian, Ms. Starmer and others.
Lester Kinsolving, a talk show colleague of Mr. Christian's on WITH-AM and once an employee of Atlantic Coast Radio, was dismissed from the case soon after it was opened by the `D attorney general. He has not been charged.
Mr. Curran said yesterday that none of the money collected for the enterprise had been recovered. Many of the investors gave Mr. Christian only a few hundred dollars, but others committed thousands -- several of them investing more than $10,000. Several members of one family put up a total of about $22,000.
The 50-year-old broadcaster told the investors he planned to buy radio stations and make movies, among other enterprises. But, Mr. Curran said yesterday, the investigation indicates that Mr. Christian's statements to investors about how he would use their money were inconsistent with the actual use.
A hearing on the charges is scheduled for Oct. 12 before Circuit Judge Edward J. Angeletti.
If convicted on the charge of fraudulent misappropriation, Mr. Christian could face a maximum of five years in jail. The maximum term for the securities violation is three years.
Sources familiar with the case say Mr. Christian and his lawyer, Barry J. C. Kissin of Frederick, have been negotiating a plea agreement with the attorney general's office. Mr. Curran confirmed that discussions had occurred, but he declined to characterize them.
Though the terms were not known, the sources have said the state is offering to suspend most of a prison sentence in exchange for a guilty plea. Mr. Christian and Ms. Starmer would be required to serve a portion of the sentence, however, possibly in a halfway house.
Mr. Christian, who has been off the air since January, declined to comment yesterday through his lawyer, Mr. Kissin. Mr. Kissin also declined to comment on the case.
Mr. Curran said the case against Mr. Christian illustrated the importance of the securities law as a protection for investors, particularly those who were unsophisticated.
"The purpose of the law is to make sure that investors are protected and given all the information about the potential investment. They can then see, up front, exactly what is going to happen," he said.
"It's troublesome," Mr. Curran added, "that a well-respected gentleman who's been on the scene for many years has had this unfortunate development."
Mr. Curran said the investigation was still under way, though no further charges were expected against Mr. Christian and Ms. Starmer. A third officer of Atlantic Coast Radio, Dale Andrews, is the subject of the continuing probe, Mr. Curran said.
The case was initiated by the Maryland Securities Division, which is part of the attorney general's office. Based on complaints filed by investors, Securities Commissioner Ellyn L. Brown began an investigation a year ago. She quickly issued an order prohibiting Mr. Christian and Atlantic Coast Radio from selling more securities.
Later, a receiver was appointed by the court to handle the company's finances with an eye toward protecting the investors. Mr. Christian later reported to the court that he had personal debts amounting to more than $270,000 -- and that Atlantic Coast Radio owed more than $1.17 million to various creditors.
In January, Mr. Christian, Ms. Starmer and Mr. Andrews conceded that they had violated provisions of the Securities Act, though not deliberately. The admissions were made in documents filed with the Baltimore Circuit Court.