The implosion of cash management firm Sentinel Management Group Inc. created many questions. Now Sentinel's bankruptcy trustee Frederick J. Grede has begun the search for answers and the process of making creditors whole. In the complaint Grede filed in bankruptcy court, he charges insiders including Philip M. Bloom, Eric A. Bloom and Charles K. Mosley of committing a long-term, massive fraud against Sentinel and its customers. In addition, Grede says they engaged in high-risk leveraged trading, commingled and misused client funds for their own financial gain, and employed a pattern of deception and lies.
“There are a multitude of issues to this case and a multitude of ends that we intend to pursue. From my perspective, the goal right now is to make a nice recovery for the creditors,” Grede says. “We will pursue every obvious avenue, and many not so obvious, to maximize that recovery.”
Grede says the defendants siphoned more than $20 million for themselves and others through bogus administrative fees, bonuses, dividends, account withdrawals and redemptions, salaries, false trading profits and other payments. He seeks a total of $350 million in actual and punitive damages.
