SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17152 / September 26, 2001.
SEC v. John E. Brinker, Jr., Gary J. Bentz, et al., Civil Action No. IP01-0259 C-H/G (S.D. Ind.).
The U.S. Securities and Exchange Commission ("Commission") announced today that it filed a motion seeking to have Gary J. Bentz ("Bentz") held in civil contempt.
In February 2001, Hon. David F. Hamilton of the U.S. District Court in Indianapolis entered an order permanently enjoining Bentz and other defendants from engaging in fraud and other misconduct in violation of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, Sections 10(b), 15(a), and 15(c) of the Securities Exchange Act of 1934, and Rules 10b-5 and 15c1-2 thereunder. The Commission's complaint alleges that Bentz and others operated a Ponzi scheme which raised approximately $7.1 million from hundreds of investors in a "prime bank" trading program. Bentz and the other defendants consented to the injunction order without admitting or denying the allegations in the complaint. (For more detail on the Commission's allegations and the injunction proceedings, see Litigation Release No.16915.)
The injunction order also froze the assets of Bentz and the other defendants. In its current motion, the Commission alleges that shortly before the asset freeze, Bentz obtained approximately $72,000 through mortgage loans, and after the freeze, he spent those funds in violation of the freeze. Accordingly, the motion asks the court to hold Bentz in civil contempt and order him to replace the spent funds.