Merrill Lynch’s Thomas Buck Is Going To Jail For Defrauding Investors

Thomas Joseph Buck (CRD#: 1024868, Indianapolis, Indiana), the general securities representative of Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”), will go to prison for forty months for committing securities fraud. Supposedly, Buck charged $2,000,000.00 in excessive commissions to customers holding commission-based trading accounts. Evidently, United States District Court Judge James Sweeney’s sentencing of Buck, 63, comes after he pleaded guilty to the felony in Case #17-cr-172.
About one year ago, on February 9, 2018, Securities and Exchange Commission (“SEC”) issued an Order in Case #: 3-18366, barring Buck from the securities industry in virtually all capacities. Previously, on December 21, 2017, the United States District Court for the Southern District of Indiana entered a final judgment in Case #: 17-CV-3984 which enjoined Buck from violating Section 10(b) of the Securities Exchange Act; Rule 10b-5; and Section 17(a) of the Securities Act.

SEC Alleges Thomas Buck Made Unauthorized Trades And Lied To Investors About Commissions

SEC alleged that Buck did not have permission to exercise discretion in Merrill Lynch customer accounts; his trades were unauthorized. Also, Buck lied to advisory customers in regard to the commissions or fees he charged in their investment advisory accounts. Plus, Buck omitted important facts concerning the charges.
Given these allegations, SEC concluded it was in the interest of the investor public to bar Buck from having an association with a broker, dealer, municipal advisor, municipal securities dealer, investment adviser, among others. SEC also barred Buck from all penny stock activities including promotions, purchases and sales.

FINRA Bars Thomas Buck For Defrauding Investors Out Of Millions

Previously, the Financial Industry Regulatory Authority (“FINRA”) barred Buck in all capacities for committing fraud, pursuant to a Letter of Acceptance, Waiver and Consent #: 2015044745701 executed on July 24, 2015. FINRA found Buck violated FINRA Rules 2010, 2020, and 2011; Section 10(b) of the Exchange Act and Rule 10b-5.
The AWC stated that while at Merrill Lynch, Buck formed “The Buck Group,” which serviced more than 3,000 Merrill Lynch customer accounts. Supposedly, Buck was mostly responsible for generating as much as $10,000,000.00 in revenues each year on the $1,300,000,000.00 held in customer accounts under management. Evidently, 80% of the revenues were derived from commission-based accounts.

FINRA Finds Thomas Buck Lacked Legitimate Basis To Put Customers In Commission-Based Accounts

FINRA reported that Buck did not confirm whether it was suitable for customers to be in fee-based accounts. Buck apparently had knowledge of those accounts being less costly for investors as compared to commission-based accounts. Indeed, a number of customers paid a lot more to invest in commission-based accounts than they would have if placed in fee-based accounts. The AWC mentioned that Buck even misled customers about the benefits of fee-based accounts to keep customers in commission-based accounts.
Also, FINRA stated that Buck did not have authorization to place trades in customer accounts. He reportedly made trades without customers’ consent. Moreover, some customers did not provide Buck with written authorization to make discretionary trades; however, Buck still exercised discretion in those customers’ accounts.
Many customers have field disputes about Buck’s trading practices. Here’s a summary of Buck’s recent complaints:

October 16, 2017 Complaint Alleging Thomas Buck’ Excessive Trading

 
A customer of Merrill Lynch filed an investment dispute on October 16, 2017 regarding Buck’s sales practices. Specifically, the customer alleged that Buck made excessive trades of equities in the customer’s retail brokerage account from 2011 to 2015. Eventually, on December 29, 2017, Merrill Lynch agreed to settle the customer’s excessive trading allegations by paying the customer $88,201.78.

February 2, 2016 Complaint Alleging Thomas Buck’s Unauthorized, Excessive Municipal Debt Trading

 
A Merrill Lynch customer contested Buck’s sales practices in filing a complaint on February 2, 2016. Supposedly, between January 2009 to March 2015, Buck made misrepresentations and omissions about investments customers purchased. Not only that, but customers contended that Buck made unauthorized and excessive trades of municipal debt investments. All things considered, on November 23, 2016, Merrill Lynch and the customers agreed for the firm to pay them $395,338.78 to settle the matter.

January 27, 2016 Complaint Alleging Thomas Buck’s Unsuitable Investment Recommendations

 
A customer of Merrill Lynch brought a complaint about Buck to the firm’s attention on January 27, 2016. Allegedly, from 2011 to 2015, Buck falsified information about fees and commissions. Additionally, the customer claimed Buck made bad investment recommendations about equities purchased for the customer’s account. Evidently, the customer acquiesced to the firm paying $56,953.00 to the customer in order to settle the matter.

Suffered losses by investing with Merrill Lynch’s Thomas Joseph Buck? If so, contact Soreide Law Group at (888) 760-6552 and speak with experienced counsel about a possible recovery of your investment losses. Soreide Law Group represents clients on a contingency fee basis and advances all costs. The firm has recovered millions of dollars for investors who have suffered losses due to misconduct of brokers and brokerage firms.