Boiler-Room Scam ‘Mastermind’ Gets Eight Years

Sep 21 2011 | 2:30am ET

The Staten Island, N.Y., hedge fund manager who admitted to lying to his clients about just about everything was sentenced to eight years in prison yesterday.

Kenneth Marsh was the last of the 18 people who pleaded guilty in the Gryphon Holdings boiler-room fraud to learn his sentence. The one he received was more than the five years U.S. District Judge Jack Weinstein initially indicated he’d impose, but less than the 10 years the judge suggested last week after hearing from the victims of the $20 million scam.

“The victims were heard and they told heart-wrenching stories,” Weinstein said.

According to prosecutors, Gryphon lied about its assets under management, invented a relationship with George Soros and made up offices in Manhattan, London and Sydney, Australia, when it was actually run out of a Staten Island strip mall. Marsh also allegedly made up two traders.

What’s more, Weinstein said, he “made criminals out of otherwise law-abiding people.”

Marsh’s lawyer, Alan Futerfas, called the sentence “fair and just,” but would not rule out an appeal.

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