Regulators seek takedown of Wall Street executive
NEW YORK — Prominent Wall Street executive Lynn Tilton cheated investors in failing companies of more than $200 million and should be banned from the industry, a government lawyer told a judge on Monday before her attorney belittled the Securities and Exchange Commission’s claims.
SEC senior trial counsel Dugan Bliss said Tilton and her New York-based Patriarch Partners group of investment firms wrongly collected the money in fees and other payments since 2003 without notifying investors that companies were defaulting on loans the investors had made to failing companies attempting turnarounds.
Bliss said the SEC is seeking to ban Tilton from the securities industry, force her to give up more than $200 million she and her companies received in fees and other payments and face other financial penalties.
Tilton attorney Randy Mastro mocked the SEC’s position, saying the case against her would be laughable were the agency not seeking to ruin her career.
He said the fraud case was built on revisionist history as the SEC ignored that she lacked motivation to cheat investors since she was already worth $1 billion or close to it when the regulatory agency claims she began the fraud.
In a statement Monday, Tilton said she was looking forward to proving the SEC’s claims are “utterly meritless.”