O.C. Broker Pleads Guilty

A Newport Beach stockbroker pleaded guilty in federal court Friday to siphoning up to $3 million from his clients’ accounts.

Richard O’Leary admitted in a plea agreement that he defrauded 40 clients. But his lawyer, Paul Meyer of Costa Mesa, contended the loss was significantly less than the $3 million that prosecutors alleged.

O’Leary spent the money on himself and his family, said Assistant U.S. Atty. Robb Adkins.

O’Leary admitted that he transferred funds into “investment accounts” that he secretly controlled, in some cases telling clients that the investments were legitimate and in others simply moving money without their knowledge or consent.

He had worked as an independent contractor for several brokerages from 1993 through 2001, when Wachovia Securities Financial Network discovered the scheme, fired him and called the FBI, prosecutors said.

O’Leary, who pleaded guilty to three counts of wire fraud, is to be sentenced July 25 by U.S. District Judge James V. Selna.

The plea suggests a sentence of four to five years in prison, although that is not binding on the judge. O’Leary also is required to pay full restitution to his victims.

-- E. Scott Reckard