Merrill Lynch has reimbursed $3,085,256, the full amount lost, to their clients who lost money as a result of a fraud perpetrated on them by one of their brokers, Marcus Boggs. Boggs was arrested in August 2019, trying to board an international flight from O’Hare International Airport in Chicago, after which charges were pressed against him by federal prosecutors.
According to his Broker Check report, Merrill is the only firm Boggs has worked with since the start of his career in the industry in 2006, till 2018, when he was fired for “withdrawal of funds from client accounts without their knowledge or approval.”
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Boggs pleads guilty
Boggs pleaded guilty to one count of wire fraud. The maximum sentence associated with the crime is 20 years. “International travel, expensive meals at restaurants, rents at multiple apartments, and the mortgage on his personal residence,” are what the funds were used to pay for, as per the plea agreement. It also mentioned the number of clients defrauded as eight. He admitted to stealing over $3 million over the period which stretched from 2008 to 2018.
In his statement to the court, while asking for leniency in sentencing, Boggs said, “Make no mistake, I take full responsibility for my actions and recognize the gravity of my wrongs. I feel pain every minute of every day and anguish that I’ve caused this to affect everyone.”
Three of his victims also made statements during the same virtual hearing in favor of awarding the maximum 78-month sentence to him.
Impact on victims
One victim, a Black woman who lost nearly $600,000, mostly in 2018, said she was “devastated beyond belief” when informed of her losses by Merrill, and told the court, “I openly wept in the Merrill Lynch offices as they began to outline the depths of the theft. I realize I was not the only victim of Marcus’ crimes but as a Black woman, I felt preyed upon. He didn’t care about me, he didn’t care about the Black community, he saw me as a target, an easy mark.”
Shainne Sharp, known to have received a settlement of $5 million for a wrongful conviction for murder, was another victim of Boggs who lost about $815,000 which Boggs apparently used to pay down his credit card dues. As stated in the complaint, Sharp’s objective while investing was to have “enough funds to sustain him for the rest of his life.”
The losses brought about significant changes, and hardships, in Sharp’s life once again, even though he was later compensated by the firm, as were the other victims. He was forced to sell off a $400,000 home he had purchased with the settlement money and move his family into an apartment.
While arguing for a strict sentence, Sharp said in his remarks, “I’m not a person to want somebody to go to jail, but Marcus really needs to be taught a lesson.” He added, “I put a lot of trust in Marcus Boggs, and I don’t trust a lot of people because I live a totally private life because of the situation I was in.”
David S. Weinstein, Boggs’ lawyer, of Miami-based law firm Hinshaw & Culbertson, argued for a short sentence of 22 months on the following grounds:
- Boggs has a heart condition that requires significant attention
- As he has been barred from the industry, he is no longer in a position to commit any more securities-related crimes
- He owned up to his crimes quickly and fully cooperated in all investigations
Judge Rowland’s considerations
Noting that Merrill reimbursing all victims in full would be a consideration in favor of Boggs, as it was rare for victims of financial frauds to receive full compensation. Judge Rowland said that Boggs’ stated intention to make good to Merrill the money paid by them might also be a consideration in his favor.
Despite the mitigants, Judge Rowland classified the aggravating factors in the case to be “pretty staggering,” nevertheless, in view of the trust his clients placed in their relationships with him, as well as “The fact that this went on for 10 years is—it’s bad.”
She saw “really no reason” for the motivation as Boggs was already earning $17,000 a month at Merrill. “I can’t quite wrap my mind around it,” Rowland said. “It was just extravagance and it was just greed.”
Marcus E. Boggs was sentenced to 42 months in prison. In addition to the 42-month prison sentence, Boggs will be subject to two years of supervised release afterward.
In January 2019, he was barred from the industry by The Financial Industry Regulatory Authority (FINRA). The grounds were his failure to respond to requests for information when they were following up with an investigation in the aftermath of his firing.
A Merrill spokesman confirmed that the firm had fired Boggs after uncovering his actions, promptly notified authorities and cooperated with federal and regulatory investigations, and compensated affected clients.