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Stockbrokers Who Betray Trust is Stockbroker Fraud

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Little Rock, ARTwo recent cases of stockbroker fraud have recently come to light. On June 2, Mark Madison, a 37-year-old agent for a stockbroker, was indicted by a federal grand jury for 23 counts of wire fraud and 17 counts of mail fraud, according to a press release issued by the US Department of Justice.

According to the indictment, Madison solicited funds from his clients for several different investments. However, instead of investing the funds as promised, Madison used $1,129,457 of the funds for his own personal benefit, including payment of the mortgage on his personal residence, country club dues and expenses, personal tax obligations, credit card payments, and repayment of personal and business loans.

The indictment details five different investments Madison allegedly promised to make for his clients, including the capital funding for a healthcare company, loans to a businessman in Utah, bond investments, investment in establishing a trading platform, and investment in an oil well in Australia.

The Federal Bureau of Investigation (FBI) and the US Attorney's Office investigated the case, with help from the Arkansas Securities Department. Each count carries a statutory penalty of no more than 20 years in prison and / or a fine of $250,000.

Meanwhile, in New York, a former stockbroker who was alleged to have defrauded Merrill Lynch out of a $780,000 bonus was sentenced last week to two to six years in prison for the con. Steven Mandala was contrite at his sentencing, when he stood before Justice Carol Berkman in Manhattan Supreme Court. "The scars of my iniquities I will carry with me for a lifetime," the 29-year-old told the court.

However, Mandala was not quite so serious in May when, according to the New York Daily News, he grinned and giggled while pleading guilty to grand larceny and identity theft charges.


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