Hedgie Greg Imbruce Found Guilty of Civil Theft Against Investors

Greg Imbruce of ASYM

A New Canaan hedge fund manger, Greg R. Imbruce has been ordered to pay triple damages for committing civil theft against his investors in ASYM Capital. The three year legal battle that included accusation of fraud and defamation ended in a $7.8 million award for investors and the loss of management and performance fees for Imbruce. News over the miss-management of fund assets was first reported by me at Growth Capitalist in 2012 when I got word from an internal whistleblower his investors suspected him of fraud. My reporting also led to an investigation and enforcement action by the Conn. Department of Banking against Mr. Imbruce last year.

Imbruce is still using lawsuits to shift or distort blame from his illegal actions. He is currently suing his hedge fund lawyers for malpractice at Levett Rockwood, in Stamford Conn. State Court for their role in advising him on actions that led to the Conn. Department of Banking asserting securities law violations. This included fraud in connection of the offer and sale of any security because Imbruce misled his investors when he told them he had put his own money in the fund to entice them to commit more capital. Arbitration Judge Gordon ruled his investors legally removed him from the fund and as a result of his securities violations they were right to take away his carried interest in some hedge fund investments, like oil and gas company Starboard Resources. The carried interest could have translated to millions of dollars for Imbruce.

In a desperate effort to slow the confirmation of the $7.8 million judgment against him, Imbruce has also sued the American Arbitration Association in New York Federal Court. He is claiming a filing fee was not timely paid his investors, or not timely billed by AAA, in a move to throw out the award on a technicality. But according to lawyers familiar with practicing in arbitration his lawsuit against AAA is frivols because AAA has the discretion to interpret their own rules. I reported at Growth Capital Investor Jon Whitcomb, the investors attorney, says the fee has been paid and this has nothing to do with the merits of the case that led to the award. Imbruce is still expected to file a motion to vacate the judgment within the next 30 days but he would have to prove there was fraud in the hearing or bias by the judge. It’s rare arbitration awards are vacated and the move is usually seen as a delay tactic to avoid paying up. Even before the the award is confirmed by a State court judge his investors can place a lien on his New Canaan mansion and his beloved sailboat Joyride.

Imbruce and his wife Alana live in a $2.1 million home in New Canaan at 92 Turtle Back Road and are active members of Stamford Yacht Club. Town records show the New Canaan home was transferred into Alana’s name in February 2012 for $1 after Imbruce knew his investors were embroiled in a dispute over how their investment were managed. Greg and Alana are still listed as co-debtors payable on the $1.376 million mortgage.

This isn’t the first time the 44 year old graduate of Westport, Conn Staples high school and Leigh University has been in trouble for his actions while working in high finance. While managing the Madoff Securities Energy Portfolio, before he started his hedge fund, FINRA issued a small fine and an enforcement action against Imbruce for securities violations related to shorting follow-on stock offerings.

But the latest investor fraud award could mean serious personal financial trouble for Imbruce. The Imbruce hedge fund had around $15 million in assets rolled into an emerging growth oil and gas company called Starboard Resources. Imbruce started the Texas-based company, with his investors’ money, to make big bucks via an IPO or merger deal, but in April 2012 the board voted to remove him from Starboard for breach of duty of care and committing an act of dishonesty. Because of the arbitration award, Imbruce has now lost any equity investment in Starboard that he might have earned while managing director of his hedge fund ASYM Capital.

Imbruce has tried to discredit the three years of reporting I have done at the financial trade publication I work for, www.growthcapitalist.com, and my reporting at teribuhl.com by filing a libel suit against me and my publisher. He is also asking for a permanent injuction against me in an attempt to stop future reporting. This is nothing more than an anti-slaap suit and we’ve moved the case to federal court so we can be awarded attorney fees if the case is dismissed. I’ve been told by three different Fairfield Country attorneys that Imbruce has tried to get them to sue me over the years but they denied the case because he didn’t have real libel claims. A young sole practitioner who works out of his home in Monroe Conn, Rich Gora, took the case and filed a suit against us in March. At no time during my years of reporting did Imbruce ask for a correction and he was always given the chance to comment before we published. We received a list of sentences he ‘didn’t like’ without explanation of why he thought they were not factual the day before he sued us. We’ve made no changes to the reporting and have continued to report on Imbruce and his alleged misconduct–many of the actions in our reporting an arbirator now says he did. We believe his goal is to burden us with litigation cost until we can’t afford to continue.

Imbruce also wrote in his lawsuit he believes I’ve taken payment from his investors to report on him. That is absolutely not true. I am paid for my reporting work by Market Nexus Media (parent of www.growthcapitalist.com) and teribuhl.com is supported by minimal donations to get the publishing cost down but often I make nothing from the stories I cover here. I report on small funds and not so famous bad actors in the market here because they are often overlooked by other major publications I’ve reported for.

Here is additional reporting on Imbruce efforts to stop the media from reporting on him. Greg Imbruce, through his attorney, choose not comment on this story.

Casino Investors claim Hedgie Plainfield designed Equity Grab Scheme

Plainfield Asset Management is back in the news for their role in an alleged predatory lending scheme with a Colorado casino. I reported for Growth Capitalist this week investors in American Gaming Group sued the manager of Wildwood Casino for getting a sweet deal from hedge fund Plainfield to buy the millions in debt the fund held for a deep discounted price.

A breach of fiduciary duty claim was made because, Joe Canfora the casino manager hired by investors, allegedly bought the debt with equity warrants for himself with out telling the investors the opportunity was available. Canfora runs Merit Management and allegedly has a history of working with Plainfield and Innovation in the past. PFAM sale to Canfora put him in the lead as the top equity investor because of the warrants in the deal that enabled him to buy company stock for cheap. A move that shocked initial investors in the deal.

Growth Capitalist also highlighted the role of LA-Based Innovation Capital, run by Matt Sodl, who helped American Gaming Group raise over $50 million during the casino build out phase. One investor called the relationship between Innovation, Plainfield, and Canfora ‘the axis of evil’ because they felt the financial firms forced investors to put Canfora into the job who loaded it up with unnecessary debt and expenses. A move designed to make it a distressed company rip for a take over if you can buy the discount debt.

Plainfield, a once $5 billion fund run by Max Holmes, was forced to shut down and liquidate its investments early in the financial crisis. I previously reported for Greenwich Time and Dealflow Media that regulators and the Manhattan D.A. were investigating the fund for predatory lending along with securities violations. The fund managers have yet be charged with any wrong doing but did fight a bucket of civil lawsuits filed by small cap companies who borrowed money from them.

Canfora is believed to have not even put up the funds to buy the Plainfield debt. It’s difficult to pass the Colorado gaming board ownership standards and some investors have speculated if the true owner of Canfora’s equity stake is a member of one of the financial firms who did the original casino financing. PFAM had tried to make an equity investment in the casino during the build out phase but didn’t get pass the Colorado gaming board review.

The investor suit is currently in arbitration but Canfora hasn’t taken their claims lightly. He sued investor John Schaffer for defamation in Colorado state court after Schaffer spoke out during a public gaming board hearing last summer on Canfora’s questionable actions. The defamation suit was tossed out in December but Canfora still denies he has done anything to harm investors in his role as casino manager.

A wealthy Philly businessman recently hired Canfora to manage a new casino he won bidding rights on in the city of brotherly love. Canfora also up and quit the Colorado casino management job around the time the investor lawsuit was filed.

Bitcoin Insight: Here is why that Digital Currency’s Value Really Jumped Sky High

I broke news about a change in how the digital currency, bitcoin, would operate on an exchange for U.S. and Canada last week and my peers in the finance and tech press woke up to this trend. Bitcoins are a peer-to-peer monetary transaction system that is trying to challenge government controlled currencies — like you know the almighty Dollar.

Unless you watch RT’s Keiser Report or read what American Banker has said about how this currency could disrupt fee revenue for banks, you’ve likely never heard of them. But since I reported at Bitcoin Magazine that Coinlab, a VC backed silicon valley firm, was using a silicon valley US bank to make transactions faster and cheaper; the value for one bitcoin went and jumped about 40 percent in the last two days. My peers who were rushing to figure out how to write about it at CNN or even Barrons thought it was all about the Coinlab deal. But they didn’t get the simple mechanics of why the currency really jumped.

This chart shows at about $43 there was a large (1,500 BTCs) ask and then there were no sellers. There is a limited supply of bitcoins, as unlike Heli Ben you don’t just print more money to manipulate their value. So since there were no sellers the price kept jumping up. And then you see another big ask (1,000 BTCs) and still no sellers so the price kept climbing all the way to $49 today. It’s leveled out to about $45 at press time but this shows what can happen if people are willing to risk buying large blocks of bitcoins and there are no sellers on the other end. It takes the value to new levels and this time scared the rest of the market into not knowing if they should hold or sell. As more people understand how bitcoins work this shouldn’t’ happen as much.

With Coinlab’s new announcement that they think they can keep like $1 million worth of bitcoins safe from being hacked or stolen…well a few institutional investors are likely jumping in BIG now. And a whole new wave of buy big and hold people will come into the equation. This could mean we see some more steep volatility jumps so it will be interesting to watch what the currency holds at next week – assuming there is not more earth shattering deal news in the space which could happen with all the VC/Angle money sniffing around Bitcoin Companies right now.

Bitcoins are a transaction based currency. They need buyers and sellers in an a somewhat equal way to keep the value from huge volatility swings. We didn’t have that this week because perception, or let’s say smart players are waking up to the reality of the currency being a viable alternate to paper money, took over.

The fact that when you buy bitcoins you can remain anonymous adds a layer of difficultly in figuring out if one or two guys who keep making up different identities are contributing to all the new buy volume or if a diverse number of people are really pilling into buy bitcoins. The latter being the ultimate dream for companies, like BitPay, who is working fast and hard to get more street level retail companies to accept bitcions.

So when more sellers enter the market – hopefully in the next few days – we could see the value go down a few bucks.

Bitcoins aren’t a fad. I wouldn’t be spending my time to learn about them and place my byline on a subject I thought wasn’t worth paying attention to. The idea of a digital currency that cuts through government currency wars and takes away fee revenue from too big to fail banks that gouge the consumer is a very real trend. Whether it’s bitcoins or ripple or another digital currency that has staying power only time will tell. But right now we are seeing venture capital money jump in to bitcoin related companies – you know like the ones that got in early to facebook or twitter – and they’ve spent a year doing research to make these investments. And it’s not stupid money being invested as I wrote about for the January issue of Bitcoin Magazine.

Sure there’s a lot of risk associated with bitcions. Value is going up and down-well more straight up right now. You can’t pay for all your food and gas with them yet. There needs to be more main street acceptance. There are lots of unknowns. Even today we don’t know WHO/How Many drove the value up in bitcoins but at least this reporter is trying to show you HOW it got done.

UPDATE 3-7-13: For those who need to hear the news on TV Max Kesier was on a RT nightly news show last night giving a quick explainer on Bitcoins. It’s worth checking out. Also as I wrote last night the value did go down a few bucks and it hovering around $42-$43 this Thursday morning. Now this is still up $10 since the Coinlab news and media blitz started last week.

Hedgie James Higgins Threaten by Wife’s Ex-Lover

James Higgins wife Susan Photo:Jim Gerweck

A New Canaan hedge fund manager was subject of a news event last week after reporting he and his wife were being harassed on the phone by a man who allegedly wanted to break them up and then force the hedgie to eat pizza. The initial news report said the man was giving the hedgie a hard time because he worked at Bear Stearns and the man was obsessed with his wife. Police reports show that former Bear executive was James Higgins (goes by Jim) who founded Stamford-based Sorin Capital Management.

The caller, Donota Anthony Minicozzi, was arrested last week for threatening, harassment, and larceny via extortion. Higgins told the local cops he was getting three to five calls a day from his alleged harasser who said things like:

“Bear Stearns crook. Notre Dame sucks. See you at South Beach” The caller said his name was Steve and started the contact in December. He’d ask James “Did you have a good year, you crook? After bankrupting Bear Stearns. 7 bedrooms in New Canaan CT. Sue was good with one bedroom in NY in her dancing years.”

It turned out that James wife, Susan, did know Donato.[They are the mid-40’s couple on the left in the photo] Police reports say she told him she dated him 20 years ago but broke up with him because he stole money from her. Donato actually has a criminal history in New Jersey for a larceny conviction in 1988 and in 2001 he was charged with forged writing. His warrant report says he now sales flooring.

Donato used disposable cells phones so the cops had to get the courts permission to ‘ping’ his number the next time he called. They were able to even track a call to a Planet Fitness in Brick,New Jersey. Apparently Donato liked to work out and do his harassing at the same time because when the cops called the gym someone who worked there said yea he’s in the gym at the same time the call was made.

James Higgins wife Susan Photo:Jim Gerweck

James Higgins wife Susan Photo:Jim Gerweck

Susan Higgins was getting her own phone calls – hang ups that is and then pizza started to be delivered to the house because Donota thought ‘it’s just a symbol that we can get to you (James) any way we want.’

How the cops charged him with larceny get’s a little fishy since he didn’t steal anything and the police report doesn’t show an extortion plan to change money ever happened. Recorded phone calls do show the ex-lover telling James “You can keep your fucking money and we are going to fucking torture your life. We are going to start sending shit to your house. The pizza is just a fucking start. Just wait till the fucking girls start coming to your house. Your life is going to be one miserable thing.”

I guess girls and pizza are not a welcome thing in the Higgins house.

When the Stamford cops finally found Donota and left a message for him to call the Special Victims unit back he lashed out one more time to James. On January 23rd at 8:51am he left an angry message about sex saying “Special victims-that should be the fucking people you screw every day. The people you take 3 percent every day. What you should be worried about is to screwing your fucking wife the one that used to screw everybody. I have film. You know your wife used to do that, and I had her plenty of times too. You should use some of the bedrooms you have in your house to screw her.”

Well now. A reporter for the Stamford Patch apparently was at Donato arraignment because he reported the New Jersey man turned himself in and told the cops he was sorry, had just been divorced, and well….was lonely. He even brought the cops one of the Motorola phones he used to make the calls.

Now apparently Donato wasn’t very good at Google research because a simple name search for James shows he left Bear Stearns in 2004 – as co-head of their commercial mortgages group – which would have been well before the bank started blowing itself up on crap resi mortgage bonds. Higgins also didn’t have a great year for his flagship hedge fund during the financial crisis. In 07 investor records show he was running $1.5 billion and had returns of over 20% but in 08 the fund suffered a 36% loss and he liquidated it in 09. Sorin Capital has other funds and started a second flagship fund which hopefully is doing ok. He did fork over near $8 million in 2008 for his newly built 7 bedroom , 7 bathroom , 9,600 square foot mansion on New Canaan’s tony Ponus Ridge Rd. Maybe Donato was a little jealous over Susan and James’s fancy house?

I called James at his Stamford office for comment today. At first the man who answered the phone said he wasn’t there. When I told him I was a reporter who was about to report James role in this little saga James quickly came to phone. He wasn’t thrilled the story would be reported and made a few off the record comments trying to convince me not to report it. He wouldn’t answer if he still feels threaten by Donato now that he’s arrested and has a protective order against him and just gave an official no comment. There is nothing in the police report saying Susan and Donato had recent contact/relations before the alleged harassment started so besides memories from 20 years ago we don’t really know what motivated Donato threatening calls and food deliveries to the Higgins.

Donato is schedule to be back in court this month. It’s not clear if the Higgins still allow pizza deliveries to their mansion.

How the NY AG built his RMBS case against JP Morgan for Bear Stearns Sins

This story has been updated

One documentary film maker, one investigative journalist, and one law firm willing to take a risk led to the lawsuit the New York Attorney General just filed against JP Morgan for a system wide effort to defraud mortgage investors by Bear Stearns.

My readers and viewers of RT’s The Keiser Report know they first learned about Bear Stearns fraud back in 2010 after I was the first journalist to report for The Atlantic Bear Stearns whistleblowers were on the record saying they were directed to make up loan level detail for the mortgage bond raters. From there I broke news again at The Atlantic in January 2011 detailing how Bear’s own internal documents showed the RMBS traders, under Tom Marano, were literally stealing billions from the clients they’d sold the mortgage bonds to via a double dipping scheme.

The documents to outline the double dipping by Bear traders was discovered by PBWT attorney Eric Haas – who also has an accounting background. It was this evidence that enabled him to add a fraud claim, that survived a motion to dismiss, to Ambac’s suit and year and a half later JP Morgan had to admit in their regulatory filings for shareholders that they were now looking at $120 billion in possible RMBS fraud and putback suits. These additional suits filed by the FHFA for the GSE’s and tons of other mortgage investors would have never happen if PBWT hadn’t been first to do the gritty research and detail to build their claims against $JPM/$BS/$EMC.

While this is likely the most impactful reporting of my career it couldn’t have happen with out one documentary film maker, Nick Verbitsky of BlueChip Films. He was first to find former EMC/Bear analyst to go on camera and detail the methods of deceit and fraud by the billions. It was Verbitsky’s unedited interviews that led to my first The Atlantic story. And it was that story to helped open up research for attorneys at Paterson Belknap for their client Amabc.

I remember getting a call notifying me the NY AG’s office had read my reporting and wanted to reach filmmaker Nick Verbitsky to get these unedited whistleblower tapes last year. And then we watched AG Schneiderman slowly start to interview the Bear Stearns whistleblowers which I reported multiple times on RT’s The Keiser Report. A program that was bold enough to trust my reporter instincts, go up against one of the world’s most powerful banks, JP Morgan, and know it was a good idea to warn viewers the bank is going to get their asses sued and it could affect the financial health of the company.

The NY AG also got a push from New York State Assemblyman Morelle who asked him to investigated Bear/JP Morgan for insurance fraud using New York State insurance laws. I first reported the NY AG was beginning his investigation in April 2011 for DealFlow Media’s The distressed Debt Report. Today we see copy cat New York Times reporter Gretchen Morgenson source that people familiar with the AG’s investigation told her he began in the Spring of 2011. In reality Gretchen read my original reporting and the The Atlantic’s mention of it back in April 2011 and I find it absurd that she can’t properly credit where she learned about it first. I have to wonder if Assemblyman Morelle, who chairs the insurance committee, is satisfied with the NY AG only bringing civil fraud charges against JP Morgan – if he’s not will he push the DOJ’s Southern District of New York office to carry the ball over the line and actually charge individual bank traders with criminal wrong doing? You can see a slew of likely illegal actions the Bear traders did that the NY AG left out of his suit in a story I wrote for DealFlow Media last August.

Today’s one of those days when it feels good to be an independent financial journalist and I want to thank my editors at DealFlow Media and The Atlantic along with Max Keiser and his producer Stacy Hebert at RT for publishing all my original reporting on this crime. To my fellow journalist just catching up on the story don’t forget to credit those who were the catalyst for action.

What’s next – I think PBWT and other Big Law firms, who have copied their suit and sued $JPM, are going start taking some serious settlement offers from $JPM and I expect it to be in the billions. I mean look at all additional whistleblowers that came forward from other firms Bear Stearns hired to help them sell mortgage bonds.

As far as JP Morgan shareholders go, if the bank’s payout to settle rmbs fraud and putback claims is in the double-digit billions then I’d expect lawyers to start filing class actions suits against JP Morgan for not disclosing enough rmbs putback risk. This is an issue I wrote about in May. There is also the fact that the SEC went to $JPM back in 2010 and told them they are not holding enough capital for putbacks – I reported this on Max Keiser’s show in November 2010. So why did the SEC allow this big bad bank to under-reserve for the last two years and report higher earnings? That’s a question we’d all like answered but are not likely to get.

Editors Note: Verbitsky’s doc film about Bear Stearns, Confidence Game, is showing at the Bruce Museum on Thursday night in Greenwich,CT. I am a panel guest, along with Roddy Boyd and William Cohan who will be speaking with Veribitsky after the movie. Come see it and hear first hand how we uncovered this fraud and how regulators came to us help build their case.

Fashion Designer Ralph Rucci Considers Bankruptcy

Fashion Designer Ralph Rucci is having a serious cash flow problem. According to people familiar with the company Rucci has met with a bankruptcy lawyer in the last few weeks and is $6.4 million in debt with about 150 creditors breathing down his neck.

He cut his 15,000 sq ft New York showroom down to 8,000 sq ft in the last year and New York Magazine reported this month he suddenly canceled an expensive runway show at Fashion Week.

Rucci’s buddy and ex-Goldman partner Guy Muzio could be faced with losing his investment in his friends company unless the House of Rucci comes up with some cold hard cash fast; and the list of mills to model agencies that haven’t been paid keeps on growing. According to people familiar with company’s finances Ralph also personally guaranteed his office lease so it’s unclear if a chapter 11 could even stop his SoHo landlord from coming after his personal bank account. Ouch!

When reached by phone for comment tonight Ralph’s sister, Rosina, flat-out denies the finance troubles. When asked what she thinks about being the highest paid person (salary around $300k) on the Rucci staff she said as a PR person she doesn’t know anything about the finances or staff salaries. Humm except she just denied the idea of bankruptcy,which is a question relating to finances, so doesn’t that seem like an odd response?

Of course if Ralph actually files bankruptcy it’s tough to tell who would be on the top of the creditors list – secured private investors or Neiman Marcus who prepays him each quarter before the goods are delivered?

UPDATE 2-17-12: A peer I worked with at the New York Post, James Covert, thinks Rucci is near bankruptcy also and has some interesting color on how the Fashion Designer has burned through cash. Covert has covered the Fashion biz beat for years and has a good handle on when these free spending designers are not telling the public the truth. Covert mentions Rucci had a $1 million tax liability problem recently and according to a source I spoke with who is familiar with the designer’s finances the government actually came knocking after the House of Rucci wasn’t paying payroll taxes. It’s unclear if he’s made due on the $1,020,000 government debt yet.
Give it a read here.

SEC adds Metter’s Greenwich Radio Station as Defendant in Spongetech Fraud Suit

The SEC is playing tough with alleged penny stock scammer Michael Metter and his Business TalkRadio Network. The Securities and Exchange Commission filed court documents Thursday adding the radio business, which includes Greenwich station WGCH, as a relief defendant in the fraud case against Meter and his pump and dump stock Spongetech. The federal regulator says because Metter has entered a letter of intent for WAY below market value for the stations that the business basically can’t be trusted to sell itself and thus should be named as a defendant to ward off buyers not willing to pay market price. You see the reason the stations were suddenly put up for sale this summer is because the SEC says BTRN owes Spongetech shareholders millions.

I reported in September for DealFlow Media, the SEC alleged that Metter and his partner Moskowitz had basically embezzled Spongetech funds into BTRN, in 2009, and helped it pay off a $5 million debt. As a result the SEC was able to get a partial asset freeze on the radio stations checking accounts and Mr. Metter had to turn over financial signing power to this right hand man Jeff Weber. Weber just happens to also be president of the Greenwich Chamber of Commerce. Since then, Weber and Metter’s job has been to keep the stations afloat until a buyer can be found. The proceeds from the stations sale (they own 4 in Greenwich, Vegas, Pittsburg and Boston) would go to the SEC, if they win or settle their case against Meter and Spongetech, who in turn would turn over proceeds to the Spongetech victims.

The SEC stated last week in court documents they’d seen deal terms to sell BTRN stations (sans the Boston one) to an unnamed buyer for only $50k cash and a $950k unsecured, non recourse, 3-year promissory note that is expected to close at the end of January. There is also a letter of intent on the Boston station the SEC says is for way below fair market value. You see earlier last year Metter’s attorney swore in court documents there was an appraisal that showed the BTRN stations were worth more than $6 million. So you can kind of see why the SEC is a little pissey about a Metter orchestrated below market, no security to pay it back, deal going down. That would mean they let him take a $16k a month salary this whole past year to do what? Doesn’t look good for the recovery of dollars for the Spongetech victims-does it? So the regulator told the court this kind of sale isn’t getting approved by them.

Well according to a letter Metter’s attorney filed with the federal court last month, Weber (who isn’t being sued by the SEC) was also doing some funny business. Metter’s attorney, Miranda Fritz wrote, Weber was using his advantage of signatory power to force BTRN to keep his current salary and benefits for the 1st six months of 2012 while the company was trying to cut expenses. When Metter said no – he quit. Metter on his part has agreed to cut his salary from about $240k a year to $165k. His attorney filed a motion at the end of December stating Metter will take bi-weekly payments of $6,875 and supposedly the station owes him another $9,938 in expenses.

But the SEC apparently got pissed when they saw Metter blow off the rules of the court. Since Jeff Weber quit on Metter last month, and he’s the only court appointed signee of the radio biz accounts, Metter has gone back to signing checks and managing money this month — a move that technically isn’t allowed by the court. So the SEC filed a motion to also cut off his bi-weekly salary.

To be fair Metter’s attorney did tell the court, last month, he’d found a CPA with Hegen Streiff Newton & Oshiro, Marc Johnson, to take over as an independent signatory of the radio biz accounts. Remember there is no way in hell the SEC is going to let Metter have power over checking accounts with cash in them. Still the court hasn’t approved any of this, so legally BTRN shouldn’t be using its cash to you know pay staff or bills. (Which would suck for the 40 or so people the company employs.)

Paul Kisslinger, SEC attorney, wrote the court on January 12th, “Given that BTRN has continued to operate in this fashion, apparently at the direction of, or with the approval of Metter, without the entry of an order by the Court, the SEC withdraws its consent to subsections 2(d) and (e) of the Proposed Order which allow Metter to continue to draw a salary or receive any other disbursement from BTRN.”

Metter’s attorney obviously wrote a nasty reply back to the court that the SEC’s move to cut off her criminally charged client was, “inappropriate, irresponsible, and should be rejected by the court.”

Stay tuned because it’s up to Judge Dora L. Irizarry, of the Eastern District of New York Federal Court, to decide what the heck to do about Metter’s salary and the friendly deal he set up to sell the stations.