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SEC LITIGATION RELEASE
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EXTRACTED KEY WORDS
SECURITIES INVESTORS CDS SELLING BENTLEY BUYING COMPLAINT ACT LITIGATION COMMISSION EXCHANGE BUSINESS BUYING HIGHER RISK LOW-RISK REPAYMENT ATTRACT ABILITY INVESTOR FUNDS DEPOSIT FEDERALLY INSURED CERTIFICATES ALLEGATIONS DENYING ADMITTING INJUNCTION ENTRY THEREUNDER VIOLATING RESTRAINING ROBERT ORDER PERMANENTLY ENJOINING |
U.S. SECURITIES & EXCHANGE COMMISSION
Litigation Release No. 17950 / January 24, 2003
On December 27, 2002, United States District Court Judge Jay C.
Waldman entered an order permanently enjoining and restraining Robert
L. Bentley from violating Section 17(a) of the Securities Act of 1933;
and Sections 15(a) and 10(b) of the Securities Exchange Act of 1934,
and Rule 10b-5 thereunder. Bentley consented to the entry of the
injunction without admitting or denying the allegations of the
Commission's complaint.
The Commission's complaint alleged that the defendants, including
Bentley, claimed to be selling bank-issued, federally insured
certificates of deposit ("CDs"), but that the defendants were in fact
selling uninsured securities. Although the defendants were using at
least some investor funds to buy CDs, the terms of the CDs often
varied substantially from those of the securities defendants were
selling. The Commission also alleged that, in many cases, investors
had to rely on the defendants' ability to attract new investors in
order for previous investors to receive repayment of their principal.
Accordingly, investors were not buying the low-risk, federally-insured
CDs that they were promised. Rather, they were buying higher risk
securities issued by defendants, whose business was uninsured,
unaudited and unregulated.
For further information see Litigation Releases (January 9, 2002);
(November 13, 2001); (October 25, 2001); (October 23, 2001).
_________________________________________________________________
Modified 01/27/2003
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