Darien's RTC chairman cited for insider trading in 2003
Darien Republican Town Committee Vice Chairman John Boulton said the RTC was aware of an insider trading citation against Bob Bewkes before appointing him committee chairman in July 2011, after former Chairman Harry Artinian stepped down.
The SEC violation was addressed by the committee when Bewkes applied for membership in September 2010, according to a statement from the RTC.
"The Darien Republican Town Committee was fully aware of Bob Bewkes' civil settlement with the U.S. Securities and Exchange Commission when interviewing him for membership in September 2010. He was questioned directly about the matter during his interview and we were satisfied with his answers," the statement reads. "This past December, Bob's candidacy for re-election to the RTC was reviewed and recommended by an independent nominating committee, and was subsequently endorsed by the January 2012 Town Republican Caucus. Bob has honored the terms of the SEC settlement and we consider the matter closed. Bob's tenure as RTC Chairman has been marked by openness, integrity and accountability. He has the RTC's full support."
No public complaints have been made regarding Bewkes' position as chairman.
Bewkes, who works as a Realtor with Kelly Associates Real Estate, Inc., in Darien, said he was unable to comment on the citation due to the terms of his settlement with the Securities and Exchange Commission.
The SEC filed a lawsuit in 2003 alleging Robert Bewkes, who was 48 at the time, and his father, Garry, engaged in insider trading. According to court documents, Garry Bewkes, who served on the Board of Directors of Interstate Bakeries Corporation, a Delaware corporation headquartered in Kansas City, Mo., tipped off his son about the company's declining financial health so his son could sell off any stock in the company.
In the documents, the SEC states Garry Bewkes received a "highly confidential" report about the deteriorating financial condition of IBC and called his son, who was employed as a broker from 1991 to June 2003, to sell all of his stock in the company.
"On Feb. 3, 2003, the day before an IBC Board of Director's meeting, Garry Bewkes telephoned his son, Robert Bewkes, and communicated negative information regarding IBC's financial condition, and advised Robert Bewkes to sell his IBC stock, court documents state. "Immediately thereafter, Robert Bewkes sold 16,230 shares of IBC stock held in his own account and the brokerage accounts of his family, friends and other clients. As a result of the timing of his sales, Robert Bewkes avoided losses of approximately $67,517 for himself, family and clients."
According to SEC documents, Bewkes sold the IBC stock at a price ranging from $14.30 to $14.42.
According to SEC documents, without admitting or denying the allegations contained in the complaint, Bewkes and his father consented to paying $202,551 in disgorgement and civil penalties. Specifically, Bewkes was ordered to pay $67,517 in disgorgement and a civil money penalty of $67,517, plus prejudgment interest. His father was ordered to pay a civil money penalty of $67,517, plus prejudgment interest. Bewkes was also barred from associating with brokers, dealers or investment advisers for a period of five years, according to SEC documents.
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