A former ConvergEx Global Markets trader has admitted to falsifying the books and records of a registered U.S. broker-dealer. Michael Craig Marshall, 47, of Bermuda, pleaded guilty today in federal court in New Jersey to one count of conspiracy to falsify the books and records of a broker-dealer.
According to court documents, ConvergEx Global Markets Limited (CGM Limited) and G-Trade Services, LLC (G-Trade) were both wholly owned subsidiaries of ConvergEx Group LLC (ConvergEx Group). G-Trade was a registered U.S. broker-dealer. As part of his plea today, Marshall admitted that clients placed orders to buy or sell securities with G-Trade, and G-Trade then routed the orders to CGM Limited.
Marshall further admitted that traders at CGM Limited regularly added a mark-up or mark-down when executing the orders. Employees of CGM Limited, G-Trade, and other ConvergEx Group entities referred to mark-ups and mark-downs as ‘spread,’ ‘trading profits,’ or ‘TP.’
At his plea hearing today, Marshall admitted that he and the other coconspirators falsified G-Trade’s books and records. In particular, Marshall admitted that he reviewed falsified transaction reports for two trades executed in August 2009 to verify that the falsified data regarding the quantities, prices, and times of the purchases reflected on the report matched actual trades that had been executed on the market on August 7, 2009, by both G-Trade’s client and other market participants. The reports hid the fact that spread had been taken on the brokerage orders, Marshall admitted. These reports were later provided to G-Trade’s client.
On December 18, 2013, Jonathan Daspin, the head trader at CGM Limited, Thomas Lekargeren, a sales trader at a different ConvergEx subsidiary, and CGM Limited each pleaded guilty to conspiracy to commit securities and wire fraud. On the same day, ConvergEx Group entered into a deferred prosecution agreement. Collectively, the two ConvergEx entities paid $43.8 million in criminal penalties and restitution.
The case is being investigated by the FBI’s Washington Field Office and the USPIS offices in Washington, D.C. and New York. The case is being prosecuted by Senior Trial Attorneys Jason Linder and Patrick Pericak of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Leslie Schwartz of the District of New Jersey.
Defendant: Michael Craig Marshall
Criminal Charges: Conspiracy to falsify the books and records of a broker-dealer
City and State: New Jersey
Date: N/A
Sentence: N/A
Dollar Amounts: N/A
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- James Trolice, Securities Fraud, New Jersey 2011 · Washington
- Aiman Hamdan, Biodiagnostic Lab Bribery, New Jersey 2013 · Florida
Key Facts
- State: New Jersey
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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