Thomas Buck, a former senior investment broker at Merrill Lynch, has agreed to plead guilty to being involved in a fraudulent overcharging case and for engaging in unauthorized trading, according to a filing from the US justice department to the federal court in Indianapolis this week.
Buck, 63, was fired by BofAML in 2015, and in the same month permanently barred from the securities industry by FINRA for several violations including mislabelling a bond trade, failing to disclose key information to a client, and giving inaccurate information to his managers.
According to the Indictment documents, Tom Buck had one other run-in with regulators following his dismissal from Merrill Lynch. In a parallel case, he settled a dispute with the U.S. Securities and Exchange Commission which claimed excessive fees of around $2.5 million, resulting from Buck overcharging at least 50 clients.
When it barred him two years ago, FINRA said that Buck failed to assess the suitability of the fees he charged some clients, charging them on a commission basis in order to generate higher revenues, and misleading them about the costs.
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Buck also made unauthorized trades and exercised discretion in certain customer accounts without prior written authorization, the Wall Street regulator said.
Tom Buck spent more than three decades at Merrill Lynch, during which he was ranked as the top financial adviser in Indiana every year since 2009, reporting that he had $1.5 billion in client assets under management.
Buck’s lawyer in the criminal case told Reuters that his client “admitted he overcharged clients, but that all of the clients made money and none lost their life savings.” He added: “This was not a case where all of his clients were on the Titanic. They were on the Queen Mary. They had an excellent voyage, and were over-billed for their rooms.”
Buck has agreed to plead guilty to the securities fraud change and could face up to 25 years’ imprisonment if convicted.
Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division commented: “These are not victimless crimes. These are crimes that can wipe out a family’s life savings and leave their financial future in ruins. That’s why the partnerships the FBI has with agencies such as the Securities and Exchange Commission are important to ensuring a stop is put to unauthorized and illegal activities.”