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Judge Nixes Sweet Plea Deal for Merrill Lynch "Crockbroker"

041510merrilllynch.JPG Former Merrill Lynch stock broker Steven Mandala strolled into court yesterday under the impression that he'd secured a lenient plea deal with the Manhattan DA, who's charged him with second-degree larceny, among other things. But Supreme Court Justice Carol Berkman put the kibosh on all that, reacting "incredulously" to the news that Mandala would plead guilty in exchange for one-year in jail and repaying half of the $765,000 he fraudulently took from the firm.

"You steal money, you give it back, and you avoid prison?" Berkman asked as she refused to approve the settlement. "I don't get it. I thought three to nine years was more appropriate." And during one testy exchange with Mandala's lawyer, Judge Berkman reportedly snapped, "I'm sorry I interrupted you while I was talking." (We'll be working that one into conversation at the earliest opportunity.)

You'll recall that Mandala, who is in jail in lieu of $500,000 bail, allegedly forged pay stubs and tax returns to convince headhunters at Merrill Lynch that he was a hot-shot partner at Maxim Group who managed $300 million worth of assets. (He was not.) Merrill lured him away with a $780,000 loan last April, and a week after depositing the loan into his parents' bank account, he bought a red Ferrari for $245,580. Merrill's lawyers say Mandala ran a savage burn on the firm, rarely showing up for work, then quitting by e-mail and keeping the loan money.

Yesterday Judge Berkman demanded to know if Merrill, now owned by Bank of America, approved of the plea bargain, asking, "Don't they have potential liability with the people who trust them with their money?" (HA. Ha ha ha ha.) As for the Ferrari, Assistant DA Vimi Bhatia told the judge, "The Ferrari has been returned to them and they're in the process of auctioning it."

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Comments [rss]

  • Yeah, this guy will get a harsher sentence for ripping off a corporation than any corporate-type will get for ripping off customers or taxpayers. Not that I feel sorry for him . . .

  • jaycjay

    So basically the plan was that he'd get $360,000 in return for spending a year in jail. I bet a lot of people would take that deal without even bothering to commit the predicate crime.

  • schadenfreudian mensch

    Is it tax free? And he gets to stay at the lovely Hotel Riker at tax expense. Win win for him.

  • Rocknrope

    I'm still unsure how he got away with this. For my mid-level job at a company years ago, I was put through the ringer by an independent background check company that basically verified every single bullet point on my resume. I also know of a guy who fibbed his salary by only $1500, and got his offer pulled after it was verified as false.

    How in hell did this guy get by with some doctored paystubs?

  • korper

    Merrill Lynch: Not really know for dotting all the i's & crossing all the t's.

  • Rocknrope

    Ya got me there.

  • matty

    yet the other crooks who actually work for ML walk around free.

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