Conviction of Former BENISTAR Chairman Vacated; Company Awarded $12.6M against PaineWebber.STAMFORD, Conn. -- BENISTAR, one of the nation's largest administrators of health and welfare benefit plans, yesterday received a double dose of good news. The July 2005 federal mail and wire fraud conviction of BENISTAR founder and former chairman Daniel E. Carpenter was thrown out by Boston federal judge George A. O'Toole, Jr., primarily because government prosecutors engaged in prejudicial conduct. In addition, BENISTAR was awarded $12.6 million in a National Association of Securities Dealers National Association of Securities Dealers (NASD) Nonprofit organization formed under the joint sponsorship of the investment bankers' conference and the SEC to comply with the Maloney Act, which provides for the regulation of the OTC market. , Inc. (NASD NASD See: National Association of Securities Dealers NASD See National Association of Securities Dealers (NASD). ) arbitration proceeding against UBS UBS Union Bank of Switzerland UBS United Bible Societies UBS United Blood Services UBS United Buying Service UBS Used Bookstore UBS University Business Services UBS Universal Building Society (UK) UBS Ulaanbaatar Broadcasting System PaineWebber, Inc. (PaineWebber) regarding the transactions that were the focus of the criminal prosecution against Mr. Carpenter. The NASD ruling determined that PaineWebber's actions were responsible for the losses in this case. "The court held that because the government's case was not 'strong,' its prejudicial closing argument that referred to stock options investments as 'gambling' warranted a new trial," said Attorney Robert M. Goldstein, who with Attorney Martin G. Weinberg, represented Mr. Carpenter in Boston. "This is also vindication for all of the loyal BENISTAR employees, customers and business partners who stood by BENISTAR and Mr. Carpenter during this ordeal," Weinberg added. "The NASD ruling is a complete exoneration The removal of a burden, charge, responsibility, duty, or blame imposed by law. The right of a party who is secondarily liable for a debt, such as a surety, to be reimbursed by the party with primary liability for payment of an obligation that should have been paid by the first party. for BENISTAR and Mr. Carpenter. The company and Mr. Carpenter have been unfairly tarnished by litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. arising from this matter, which has been drawn out for more than five years," said Richard S. Order, an attorney in Axinn, Veltrop & Harkrider LLP's Hartford, Connecticut “Hartford” redirects here. For other uses, see Hartford (disambiguation). Hartford is the capital of the State of Connecticut. It is located in Hartford County on the Connecticut River, north of the center of the state. office who represents BENISTAR. From 1998 to 2000, a company called BENISTAR Property Exchange acted as a qualified intermediary The Qualified Intermediary (also known as an Accommodator) should be a corporation that is in the full-time business of facilitating 1031 exchanges. The role of a QI is similar to, but not identical to, the role of an escrow company. for like-kind exchanges under section 1031 of the Internal Revenue Code The Internal Revenue Code is the body of law that codifies all federal tax laws, including income, estate, gift, excise, alcohol, tobacco, and employment taxes. These laws constitute title 26 of the U.S. Code (26 U.S.C.A. § 1 et seq. . The provision allows taxpayers to defer payment of capital gains taxes on the sale of investment property by rolling sales proceeds into the purchase of new property. Although BENISTAR Property successfully handled over $100 million of like-kind exchanges for 119 clients, approximately $9 million of the funds from seven clients were lost when PaineWebber abruptly shut down BENISTAR Property's investment accounts in December 2000. It was this action that the NASD found was wrongful and resulted in the arbitration award to BENISTAR of $12.6 million. BENISTAR maintains its corporate headquarters in Simsbury, Connecticut just outside of Hartford (CT). BENISTAR also has regional offices in Stamford (CT), Chicago (IL) and Charlotte (NC). As an industry leader in employee welfare benefit administration, BENISTAR provides professional administrative services for over 1,500 corporate clients with an aggregate employee base of over 250,000. For more information about BENISTAR, please visit www.BENISTAR.com |
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