Steven Mandala, a former Merrill Lynch & Co. broker, pleaded guilty to charges of grand larceny and identity theft Wednesday. Mandala's agreement, which was made in the New York state Supreme Court, was a promise that he will pay back $780,000 he stole from Merrill Lynch in exchange for an abbreviated two- to six-year prison sentence. A grand larceny conviction could have held a prison term of up to 15 years.
Mandala rejected an offer in April for a three- to nine-year prison term if he pleaded guilty to the top count of grand larceny. Maxim Group employed him as a stockbroker before he joined Merrill in April 2009. Mandala then falsely claimed he managed $300 million in assets and earned $765,000 a year in order to get a loan of $780,000 from Merrill, which was to be paid back over eight years.
Mandala quit less than two months later, used the money to buy a $245,000 Ferrari Spider in his father's name and deposited the remaining money in his parents' bank account.
According to the Bloomberg report, Franklin Rothman, Mandala's attorney, said that the Ferrari was sold to help pay back the money, but Mandala still has about $378,000 to pay back. Justice Carol Berkman said that if Mandala doesn't pay back the remainder of the money, he will be subject to prosecution for contempt. She also stated Mandala has to pay the money, after his prison release, every month over a 10 year period as part of the plea arrangement.
The case is People v. Mandala, and to read more of this story, follow this link: http://www.bloomberg.com/apps/news?pid=20601127&sid=ayQH9r2BSgfE