Prosecutors say a broker lied about his business successes to trick Merrill Lynch into lending him $780,000. They also claim he spent the loot on a Ferrari sportscar and other niceties..
Prosecutors say a broker lied about his business successes to trick Merrill Lynch into lending him $780,000. They also claim he spent the loot on a Ferrari sportscar and other niceties.
Steven Mandala pleaded not guilty Tuesday in New York to grand larceny and other charges. Defense lawyer Frank Rothman says the case is a dispute over the timetable for repaying the loan.
Manhattan prosecutors say the 29-year-old Mr. Mandala concocted phony documents to persuade Merrill he could bring in business worth more than $1 million a year.
Prior to applying for a job at the Bank of America unit, Mr. Mandala was a stockbroker with the Maxim Group. In that position, he apparently earned a salary of $100,000. But prosecutors say that Mr. Mandala told Merrill he was a partner at Maxim. He also told his future employer that he managed $300 million worth of assets and generated. $1.5 million for Maxim, according to prosecutors.
The DA's office alleges that Mr. Mandala used bogus documents to convince Merrill that he was a top producer at Maxim. To persuade Mr. Mandala to join the firm, Merrill purportedly offered him the large loan.
Typically, such loans are only proffered to potential hires who are top performers at their firms.
According to court documents, Mandala was far from a stellar performer at either firm. They say he brought in only a couple of small-player clients at Merrill before leaving the firm in June after two months on the job.
[The Associated Press contributed to this article].
