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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowA Hamilton County man who swindled almost $4 million from investors has been sentenced to more than five years in federal prison for securities fraud, the U.S. Attorney’s Office announced Wednesday.
John K. Marcum, 51, of Fishers, received a 66-month sentence from U.S. District Judge Jane Magnus-Stinson and was remanded to the U.S. Bureau of Prisons to begin his prison time immediately.
Marcum was ordered make restitution of $3.9 million to 17 victims and serve three years of supervised release after his prison sentence.
Marcum founded the investment firm Guaranty Reserves Trust LLC, which operated in the Indianapolis area from 2010 to 2013. The Securities and Exchange Commission said Marcum helped investors set up no-fee individual retirement accounts that gave him control over their retirement assets. He told them he would earn them significant returns by day-trading in stocks while guaranteeing the safety of their principal investment. However, the SEC said, Marcum did little actual trading and lost more than $900,000 when he did.
He used much of the rest of the investment money to finance a personal line of credit and on speculative start-up ventures, cars, vacations and gifts. Investigators said he spent money on several start-up businesses, including a restaurant, a bridal store and a reality TV show about a bounty hunter.
The U.S. attorney’s office said Marcus told investors that he represented celebrity clients and traded very conservatively. He initially was able to keep clients from becoming suspicious by issuing fake statements that showed they were earning returns of as much as 20 percent.
He eventually was caught when some of his investors asked him for access to their funds and he couldn’t provide it, prompting an investigation by the SEC and the Internal Revenue Service.
At sentencing, a 70 year-old widow testified that she gave Marcum $600,000 from a lawsuit related to the accidental death of her husband. He lost the entire amount. Six victims testified they will be working for the rest of their lives because Marcum used their life’s savings.
Marcum previously worked as a registered representative of Merrill Lynch from 1996 to 2003 and was CEO of ProActiv Advisors from 2003 to 2004, the SEC said.
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