Former Merrill Lynch star broker Thomas Buck sentenced to 40 months in prison

He pleaded guilty to securities fraud in 2017; charged clients excessive commissions

Feb 14, 2019 @ 2:16 pm

By InvestmentNews

Former Merrill Lynch star broker Thomas Buck was sentenced Wednesday by a federal judge to three years and four months in prison, according to an article in the Indianapolis Business Journal.

Mr. Buck, 65, who pleaded guilty to one count of securities fraud in October 2017, also agreed at that time to pay a $5 million civil penalty after prosecutors alleged he charged clients $2 million in excessive commissions and failed to recommend fee-based accounts, according to the report.

The 40-month sentence imposed by Judge James Sweeney in federal court, the southern district of Indiana, fell short of the 78-month sentence prosecutors had sought.

During the sentencing hearing Wednesday, Mr. Buck addressed the court, along with his wife, four daughters, and other family and friends in the gallery, according to the report. He read a statement in which he expressed remorse and took responsibility for his actions.

"I make no excuse. I point the finger at no one but myself," Mr. Buck said. About 30 people, including one of Mr. Buck's victims, were present for his remarks, according to the Indianapolis Business Journal article. "I have let down nearly everyone who has ever meant anything to me."

The Securities and Exchange Commission last year barred Mr. Buck from the brokerage and investment advisory businesses.

In a complaint filed in 2017, the SEC said that from 2012 through March 2015, Mr. Buck received more than $2.5 million in excessive commissions and fees from at least 50 clients with whom he was working in his Carmel, Ind., practice. He headed what was known as the "Buck Team" with more than 3,000 accounts and $1.3 billion in assets under management.

The SEC said Mr. Buck put clients into accounts in which they paid commissions rather than less-expensive fee-based alternatives. He did not tell clients that his commissions exceeded promised limits, and placed unauthorized trades in their accounts.

In 2015, Merrill Lynch fired Mr. Buck, who at the time was the firm's top broker in Indiana.

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