Bennett Funding Group

Source: Wikipedia, the free encyclopedia.

The Bennett Funding Group was a leasing & funding company based in Syracuse, New York. BFG operated under the Bennett Receivables Corporation, Bennett Receivables Corporation II, Bennett Management and Development Corporation, +++The Processing Center, Inc., Resort Service Company, Inc., American Marine International, Ltd., Aloha Leasing, and Aloha Capital Corporation brands.

From the

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On March 28, 1996, the SEC filed a civil action against The Bennett Funding Group, Inc., its chief financial officer, Patrick R. Bennett, and other companies Bennett controlled, in connection with an alleged fraudulent scheme. The SEC alleged that the defendants fraudulently raised more than several hundred million dollars, purportedly to purchase assignments of equipment leases and promissory notes.

On March 29, 1996, the four corporate defendants filed for protection under Chapter 11 of the Bankruptcy Code. On April 18, 1996, the Bankruptcy Court of the Northern District of New York appointed Richard C. Breeden as Trustee.

Background

Bennett Funding Group was a finance company that leased office equipment, such as

fax machines
, and then sold securities to investors backed by the leases. The company was founded and wholly owned by Edmund ("Bud") and Kathleen Bennett. The company was run by their sons, Michael, the CEO, and Patrick, the CFO.

The SEC filed civil charges against the company in March 1996. On December 13, 2004, the SEC civil action against Patrick R. Bennett was closed based on a final consent agreement between Patrick R. Bennett and the SEC, without Patrick R. Bennett admitting any wrongdoing and without any financial judgment against Patrick R. Bennett.[1]

Funds from the company were invested in such things as the

Chapter 11 bankruptcy. The bankruptcy ended in 2009, with recoveries of over $752 million. At the time of the bankruptcy filing, total reported assets of The Bennett Funding Group, Inc. ("Bennett Funding Group"), exceeded total liabilities.[6]

On February 25, 2008, the

bankruptcy court judge entered an Order approving a Global Settlement Agreement between the Bennett Funding Group Chapter 7 Trustee and Patrick R. Bennett, and other parties, dismissing all claims against Patrick R. Bennett and counterclaims filed by Patrick R. Bennett against the Chapter 7 Trustee, without Patrick R. Bennett admitting any wrongdoing and without any financial judgment against Patrick R. Bennett [7]

Eleven people involved in the alleged fraud faced criminal charges. Nine pled guilty, including Michael Bennett, one was found innocent, and one, Patrick Bennett, was convicted. Patrick R Bennett's first

criminal forfeiture order was also entered against Patrick R. Bennett in favor of the government based on the financial transactions underlying the money laundering allegations, funds never received personally by Patrick R. Bennett [8] At the conclusion of the second trial, the alleged 'ponzi' scheme counts were dismissed on motion by the government.[9]

In April 2000, Patrick R. Bennett was sentenced to 30 years in federal prison (later reduced to 22 years) under the mandatory federal sentencing guidelines. Edmund and Kathleen Bennett were not charged.[10]

On January 12, 2015 the criminal forfeiture liability against Patrick R. Bennett was discharged in a federal bankruptcy case.[11]

References

  1. ^ SEC v. The Bennett Funding Group, Inc., Patrick R. Bennett, et el., Bankruptcy Case No. 96 Civ 2237 (JES)(SDNY)[1]
  2. ^ Bennett Funding Executive Charged With Ponzi Scheme Washington Post June 27, 1997
  3. ^ Bennett risking a longer term unless he tells where money is The Baltimore Sun December 4, 1999
  4. ^ The Unraveling of a Safe Bet Washington Post August 10, 1996
  5. ^ Bennett Funding Bankruptcy Finally Over syracuse.com June 27, 2009[4]
  6. ^ In Re Bennett Funding Group., Inc., Bankruptcy Case No. 96-61376 (SDG)(NDNY)[2]
  7. ^ In Re Bennett Funding Group., Inc., Bankruptcy Case No. 96-61376 (SDG)(NDNY)[3]
  8. ^ United States v. Bennett, Criminal Case No. 97-CR-639 (PAC)(SDNY)
  9. ^ United States v. Bennett, Criminal Case No. 97-CR-639 (PAC)(SDNY)
  10. ^ United States v. Bennett, Criminal Case No. 97-CR-639 (PAC)(SDNY)
  11. ^ In Re Patrick R. Bennett, Bankruptcy Case No. 14-70065 (JAD) (WDPa.)