PHILADELPHIA — The latest updates involving the distribution of more than $339 million to those who were impacted in the Bentley Financial Services certificate of deposit Ponzi scheme came on Jan. 31.
Bentley was charged with selling supposed bank-issued, federally insured CDs that were actually uninsured securities. Hundreds of credit unions, banks, and individuals invested more than $370 million. Since then, Peninsula Bank, Joseph Marzouca and Ted Benghiat, Southeastern Securities, Inc. and SFG Financial Services, Inc. have been named as defendants. Robert Bentley, who ran Bentley Financial, pled guilty to two counts of wire fraud and one count of bank bribery. He is currently serving five years in prison and was ordered to pay $3.25 million in fines.
David Marion, the court-appointed receiver, said appeals, cross appeals, and the first round of briefs have been filed in the U. S. Court of Appeals for the Third Circuit in the Bentley related case of David H. Marion, Receiver v. TDI, Inc., et al. Barring any further delays, the briefing will be completed in the coming months, followed by oral argument and finally, a decision from the Court of Appeals.
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"Although we hoped for and tried to reach an early and amicable resolution in the TDI Case, from the beginning the defendants have done everything possible to contest, add expense and cause delay in the process," according to Marion. "When they lost at trial, they hired new lawyers, filed new motions, and caused additional delays."
While the final verdict does not guarantee that the receivership will ultimately recover the sums awarded, it does allow it to continue efforts to pursue recovery. The Benghiat and Peninsula defendants have assets and Marion has instituted proceedings in Florida to trace and collect assets from the Benghiat defendants. On July 30, 2007, Peninsula Bank reported total assets exceeding $683 million and shareholders' equity exceeding $54 million.
The receiver is also pursuing recoveries in two separate litigation matters. A federal court action filed against an insurance company pursuant to a fidelity bond insurance policy owned by Bentley Financial is scheduled to go to trial in May 2008. The second matter, a state court action filed against another bank that was involved with the Bentley entities, is in the pre-trial stage, according to Marion. When and what may be recovered from these actions are questions that cannot be answered at this time, the receiver said.
As of Dec. 31, nearly $340 million has been returned to claimants.
NCUA continues to urge credit unions to practice due diligence when dealing with third-party safekeepers to avoid scenarios like Bentley Financial.
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