A federal judge in Dallas has ordered a former Merrill Lynch and Hilltop Securities broker to serve 48 months in prison in Texarkana, Texas, and pay $2.455 million in restitution, according to court documents.
Rajesh Markan was ordered by Judge David Godbey to start serving Jan. 12. Godbey also recommended that Markan participate in the Bureau of Prisons Residential Drug Abuse Treatment Program.
The Securities and Exchange Commission filed a complaint against Markan on June 27 for soliciting his brokerage customers to invest in a fake private equity fund.
According to the SEC’s complaint, from at least 2015 through July 2024, Markan, while working as a registered representative of two dually registered broker-dealers and investment advisors, "solicited approximately ten of his brokerage customers to invest, collectively, approximately $2.9 million in a purported private equity fund" called “Intrinsic Value Portfolio.”
The SEC alleged "that because Markan claimed it was a private equity investment, Markan told investors that their money would be tied up for six to twelve years, but he assured them that, ultimately, they could expect to make above-market returns."
None of Markan's representations were true, the SEC said.
"The fund was fake and never existed, there was no association with the New York private equity firm, and Markan misappropriated most of the investors’ money for himself," according to the complaint.
The SEC also alleged that Markan "lulled investors by sending fabricated statements purporting to show their account balances, and Markan created a fake domain name so he could send emails as a purported employee of the New York private equity firm."
The U.S. Attorney’s Office for the Northern District of Texas filed criminal charges against Markan in U.S. District Court for the Northern District of Texas, to which he pleaded guilty June 10, 2025. On Oct. 1, 2024, the Financial Industry Regulatory Authority barred Markan.
Markan's BrokerCheck profile shows that he has eight pending customer complaints.
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.