The U.S. District Court sentenced former Bank of America Merrill Lynch financial adviser Gary Harrison Lane to 10 years in prison after convictions on 29 counts with charges including defrauding multiple investors, mail fraud, selling away, attempting to evade taxes and, of course, operating a Ponzi scheme.
According to the initial FINRA Letter of Acceptance, Waiver and Consent, issued in September 2011, regulators barred Lane from the securities industry for converting to his own use $4.93 million, gathered through a series of personal checks from eight customers who Lane misled into falsely believing they were investing in US Treasury or corporate bonds.
Lane specifically promised investors that their funds would be invested in the US Treasury bonds that would pay better than 6% interest and mature after two years.
Instead of investing the $4.93 million funds, Lane allegedly and without authorization deposited these checks into his wife's E*Trade account in order to effect the misconduct of conversion for personal use.
At the time, FINRA also cited Lane for attempting to disguise this conversion by making payments of $736,000 to at least six of the affected customers from a bank account set up to bear the name of the United States (as in the US Treasury). Investigators additionally charged Lane with creating and providing fictitious receipts and typed certifications regarding the non-existent US Treasury/corporate bond investments.
The misconduct, which occurred between 2005 and 2011, resulted in a Merrill Lynch investigation and Lane's termination from the firm in March 2011. The news release also indicates Merrill Lynch has since provided restitution to affected investors.
Nonetheless, U.S. attorney for the District of Nevada Daniel G. Bogden, who prosecuted the case and drew the guilty verdict, offered the following advice to investors looking for fast money: "Beware of persons who offer better interest rates than traditional sources."
He continued by describing the pattern of a serial Ponzi schemist: "They prey on the elderly and unsophisticated and will use numerous methods to steal your money. If you do not know if an investment opportunity is legitimate, it is always better to investigate the person or company first before turning over any money to them."
If you have invested with Gary Harrison Lane, firm Merrill Lynch or with any other broker or financial adviser whose too-good-to-be-true investment promises have turned out to be nefarious Ponzi schemes, and this illicit and potentially illegal conduct has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.
News: Ex-Merrill adviser sentenced to 10 years in prison (InvestmentNews)