UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 16054 / February 4, 1999
SECURITIES AND EXCHANGE COMMISSION v. LENNOX INVESTMENT GROUP, LTD.,
ACTIVE INTERNATIONAL, INC., RANDALL W. LAW, JAMES F. WARDELL, MONICA M.
ILES, FRANK L. PEITZ, AND DANIEL B. BENSON, 4:98CV536-Y, USDC, ND/TX
(Fort Worth Division)
On January 29, 1999, Judge Terry R. Means, United States District
Judge for the Northern District of Texas, entered an order granting
the Securities and Exchange Commission’s ("Commission") motion for
default judgment against defendants Daniel B. Benson ("Benson") and
Active International, Inc. ("Active"), and relief defendants Benson
Financial, Inc. ("BFI"), P.B.F. Capital Group, Inc. ("PBF"), and
I.B.I., Inc. ("IBI"). The Court ordered Benson and Active, and relief
defendants BFI, PBF and IBI, to pay disgorgement in amounts
representing money or the value of property received from funds
collected from investors as a result of the defendants’ violations of
the federal securities laws. Specifically, Benson, Active, and relief
defendants BFI, PBF and IBI, were ordered to disgorge the following
amounts: (1) Benson and Active, jointly and severally - $11,109,000,
plus prejudgment interest of $2,500,000; (2) BFI - $2,053,586, plus
prejudgment interest of $445,099; (3) PBF - $3,949,273, plus
prejudgment interest of $839,519; and (4) IBI - $335,000, plus
prejudgment interest of $18,196. The Commission has submitted an
application to the Court proposing civil penalties of $100,000 against
Benson and $500,000 against Active.
The Commission’s complaint charged Benson and Active, and other
defendants, with raising approximately $11.1 million from more than 50
investors in at least 10 states through the fraudulent offer and sale
of unregistered "prime bank" securities. Investors were told that their
funds would be placed in an escrow account, with the investment
principal guaranteed, and that their funds would be invested in a
trading program where investors could expect a yield of 122.5% per week
for 40 weeks during the 54 week term of the program. In fact, according
to the complaint, the trading program did not exist and the
defendants, instead of investing the funds, stole the entire $11.1
million of investors’ funds which were disbursed for the benefit of
themselves and their designees, including the relief defendants.
The Court’s latest order followed a November 24, 1998 order in
which the Court entered permanent injunctions by default against Benson
and Active, enjoining them from further violations of the antifraud
provisions of the federal securities laws found in Section 17(a) of the
Securities Act of 1933, and Section 10(b) of the Securities Exchange
Act of 1934 and Rule 10b-5 thereunder.
SNIPPETS:
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
On January 29, 1999, Judge Terry R. Means, United States District Judge for the Northern
The Court ordered Benson and Active, and relief defendants BFI, PBF and IBI, to pay
Specifically, Benson, Active, and relief defendants BFI, PBF and IBI, were ordered to
The Commission’s complaint charged Benson and Active, and other defendants, with raising
Investors were told that their funds would be placed in an escrow account, with the
In fact, according to the complaint, the trading program did not exist and the defendants,
The Court’s latest order followed a November 24, 1998 order in which the Court entered
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