Benger Fair Fund

Welcome to the Benger Fair Fund Website

This website has been established to provide general information related to the Benger Fair Fund.

Important Dates and Deadlines

Submit a Claim Form

April 13, 2018

This is a securities class action litigation currently pending before the Honorable Jeffrey Cole in the United States District Court for the Northern District of Illinois (the “Court”). This action is known as Securities and Exchange Commission v. Stefan H. Benger, et al., Case No. 09-CV-00676.

On February 3, 2009, the U.S. Securities and Exchange Commission (“SEC” or “Commission”) filed an emergency law enforcement action (the “Complaint”) in federal court (the “Court”) against Stefan H. Benger, Jason B. Meyers, SHB Capital, Inc., International Capital Financial Resources, LLC, CTA Worldwide Services, SA and Stephan Von Hase (collectively, the “Distribution Agent Defendants”)’ and Philip T. Powers, Handler, Thayer & Duggan, LLC, Frank I. Reinschreiber and Global Financial Management, LLC (collectively, the “Escrow Agent Defendants,” and together with the Distribution Agent Defendants, the “Defendants”).  The action alleged that the Defendants engaged in an ongoing boiler room scheme run from their residences and offices in Chicago.  From at least March 2007 through February 2009, that scheme raised approximately $44.2 million from more than 1,400 foreign investors, primarily through the sale of U.S. penny stocks.

This scheme involved the offer and sale of stock in at least eight penny stock issuers: China Voice Holding Corp., Integrated Biodiesel Industries Ltd., Biomoda, Inc., Pharma Holdings Inc., World Energy Solutions, Inc., Revolutions Medical Corp., Earthsearch Communications, Inc., and Essential Innovations Technology Corp. (together the “Issuers”).    Integrated Biodiesel Industries Ltd. was subsequently dismissed from the litigation and their stock is not included in the Eligible Securities (as defined in the Notice) for this matter.  All but one of these companies were based in the United States.  With the exception of Integrated Biodiesel Industries Ltd. and Pharma, the stock for each of the Issuers was quoted through the OTC Bulletin Board or “Pink Sheets.”  At the time of filing the Complaint, the stocks of Integrated Biodiesel and Pharma were not yet listed on any stock exchange or quoted through a service like the OTC Bulletin Board.  The stock of most if not all of the Issuers traded at prices under $5 per share and otherwise met the definition of a “penny stock” under the federal securities laws.

CTA Worldwide Services, SA (“CTA”) and Stephen von Hase (“von Hase”) each received a significant sum of investor proceeds through payment made by the Escrow Agent Defendants.  These investor proceeds represented undisclosed sales commissions from the boiler room scheme.  Neither CTA or Stephen von Hase had any legitimate claim to the funds that they received, nor did they provide any services to justify the receipt of such funds.

On April 1, 2010, a final judgment was entered against Defendant Handler, Thayer & Duggan LLC (“Handler”) finding that it was liable for disgorgement in the amount of $196,912.45, representing profits gained as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $16,447.18 and a civil penalty in the amount of $25,000.00 pursuant to section 21(d)(3) of the Securities Exchange Act of 1934 (the “Exchange Act”).

Also on April 1, 2010, the SEC filed an Amended Complaint (the “Amended Complaint”) against all remaining Distribution Agent Defendants and Escrow Agent Defendants, and CTA and Stephen von Hase, consolidating them into one defendant group.

On December 20, 2011, the SEC filed its Second Amended Complaint.

On January 15, 2013, a corrected final judgment was entered against Stefan H. Benger (“Benger”) and SHB Capital, Inc. (“SHB”) permanently restraining them from further engaging in the fraudulent actions alleged in the Second Amended Complaint.  It also found them liable for disgorgement in the amount of $422,004.10, representing profits gained as a result of the conduct alleged in the Second Amended Complaint, together with prejudgment interest thereon in the amount of $26,869.79, and a civil penalty in the amount of $250,000.00 pursuant to section 20(d) of the Securities Act of 1933 (the “Securities Act”) and section 21(d)(3) of the Exchange Act.

On January 23, 2014, the SEC moved for default judgments, based upon its Second Amended Complaint, against Defendants von Hase, CTA, and International Capital Financial Resources, LLC (“ICFR”), and moved to dismiss all claims against defendant Jason B. Meyers, who died subsequent to the filing of this lawsuit.

On January 28, 2014, the Court entered a final judgment against ICFR ordering Bank of America, options Xpress, and Apex Clearing to liquidate and transfer ICFR’s holdings in certain of their accounts. 

On January 29, 2014, the SEC filed a Third Amended Complaint to supersede the Second Amended Complaint with respect to Philip T. Powers (“Powers”), Frank I. Reinschreiber (“Reinschreiber”), and Global Financial Management (“Global Financial”).

On April 9, 2014, an amended final judgment was entered against Powers permanently restraining him from further engaging in actions alleged in the Third Amended Complaint, and also finding him liable for disgorgement in the amount of $77,560.13, representing profits gained as a result of the conduct alleged in the Third Amended Complaint, prejudgment interest thereon in the amount of $4,698.52, and ordering a civil penalty in the amount of $25,000.00 pursuant to section 21(d)(3) of the Exchange Act.

Also on April 9, 2014, the Court entered an Amended Final Judgment as to Reinschreiber and Global Financial permanently restraining them from further engaging in actions alleged in the Third Amended Complaint, and also finding them jointly and severally liable for disgorgement in the amount of $78,348.00, representing profits gained as a result of the conduct alleged in the Third Amended Complaint, prejudgment interest thereon in the amount of $1,623.00, and ordering a civil penalty in the amount of $25,000.00 pursuant to section 21(d)(3) of the Exchange Act.

By Order dated September 3, 2015, the Court created a Fair Fund pursuant to Section 308(a) of Sarbanes-Oxley, as amended, to return funds to injured investors. The Court appointed Kurtzman Carson Consultants, LLC (“KCC”) to serve as the distribution agent (“Distribution Agent”) to oversee all aspects of the administration and distribution of the Fair Fund in accordance with the terms of the Distribution Plan, and in coordination with the Commission staff.

On February 22, 2016, a final judgment and injunction was entered against Stephan von Hase and CTA that, among other things, restrained them from further engaging in actions alleged in the Third Amended Complaint, and held them jointly and severally liable for disgorgement in the amount of $3,031,999.45, representing profits gained as a result of the conduct alleged in the Second Amended Complaint; prejudgment interest thereon in the amount of $759,151.46; and ordering a civil penalty in the amount of $400,000.00 pursuant to section 20(d) of the Securities Act and section 21(d)(3) of the Exchange Act.  These amounts remain due and owing.

With the exception of von Hase and CTA, the disgorgements pursuant to the final judgments against the Defendants (collectively the “Final Judgments”) were paid to the Commission and are currently invested at the Bureau of the Fiscal Service (“BFS”) at the United States Department of the Treasury. Any investment fees of the BFS will be paid by the Fair Fund.

Although the information on this website is intended to assist you, it does not replace the information contained in the  Benger Fair Fund Notice (the “Notice”). We recommend that you read the Notice and other relevant case documents carefully.