Florida-Based Bank, Securities Firm Ordered by Jury to Pay $33 Million in Bentley CD Scam

PHILADELPHIA – A bank and securities firm in Florida have been found liable to pay $33 million in damages for their involvement in a certificate of deposit scam transacted through Bentley Financial Services. Credit unions were among the more than 200 clients that had purchased supposed CDs through Robert L. Bentley’s firm from 1994 to 2001. Collectively, they invested more than $370 million in the uninsured, fake CDs. David Marion, the court-appointed receiver, said $339 million has been returned to claimants as of May 30. Bentley is currently serving a 55-month prison sentence for mail fraud and bank bribery. On June 8, a federal jury found Delray Beach, Fla.-based Peninsula Bank and former executive vice president Joseph Marzouca liable for $13.1 million in damages, according to the receiver. Miami-based Southeastern Securities Inc., its president Theodore Benghiat, and affiliate SFG Securities Inc. were also found liable for $19.7 million. Marion had previously said that the recoverable assets available at the inception of the receivership were “substantially less” than the total allowed claims of the investor claimants and attempts continue to seek the rest of the money owed to claimants. The receiver has continued to collect assets, according to its lawsuit presented at a trial that began May 24 including from certain financial institutions, securities firms, accounting firms and related individuals that allegedly assisted Bentley in the operation of his “Ponzi scheme.” The litigation seeks to recover from the assisting defendants the losses which rendered Bentley Financial Services, Inc. unable to pay monies contractually owed to investors. “It is possible that either side may choose to appeal the jury’s eventual verdict and it is also possible that the Receiver and the Assisting Defendants may reach a settlement,” the receiver said. “The Receiver is therefore unable to estimate when the litigation will be concluded.” As of March 31, 2006, the receiver said it held approximately $11 million in liquid investments, primarily interest-bearing institutional funds invested in U.S. Treasury obligations and U.S. government agency obligations. The receivership continues to earn a return on the assets it holds with the weighted average yield on invested assets being approximately 4.3% as of March 31, 2006. So far, the income earned on the receivership’s assets has, to date, exceeded the administrative, legal, tax and other expenses of operating the receivership and marshalling the assets, according to Marion. However, the distribution of more than $339 million to claimants has significantly reduced earned income. “As a result, there have been and will continue to be periods during which current expenditures (including taxes) exceed current income,” the receiver said. The receivership’s liabilities consist primarily of those allowed claims made by Bentley Financial Service investors and others in the claims process, taxes, and administrative and legal expenses. The remaining unpaid allowed investor claims total approximately $32,064,000. [email protected]