The Securities and Exchange Commission said last week it issued fines of $1.4-million and six-month suspensions against two former salesmen for Bentley Financial Services, the defunct Philadelphia CD broker that sold credit unions more than $200 million of phony CDs.
The two salesmen, Mathew Matz and Robert Glazewski, agreed to the SEC's order suspending them from the securities business for six months and agreed to pay restitution to investors of $710,874 and $672,147, respectively, with most of the restitution eliminated because of an inability to pay. Bentley, which is currently under federal receivership, sold more than 110 credit unions certificates purporting to be federally insured bank CDs, when the funds were invested instead in the company's and the owner's own name.
Credit union investors, which made up most of the company's customers, are expected to retrieve around 85% to 90% of their principal upon liquidation of the $370-million estate, the largest receivership ever under SEC jurisdiction. Sources with the receiver said they expect to resolve a dispute with the Internal Revenue Service over the estate and its taxable liability which will enable them to begin issuing checks to investors of around 60% of their total claims.