Proceeds Fail to Reach Coffers : Benefit No Longer Music to Symphony’s Ears

“The Symphony is having a party!” bannered the invitations from the San Diego Singles’ Society Inc. “Don’t miss out on the fun.” For the cost of $10 to $15, partygoers, mainly young career professionals, were invited to Symphony Hall to celebrate its one-year anniversary.

It was a party, the invitation said, with a lofty purpose: “Proceeds to benefit the San Diego Symphony.” Given the severe financial troubles that have dogged the symphony, it was certainly money that could be used.

But today, nearly two months after several hundred people attended the Nov. 18 benefit, symphony officials are wondering what happened to the ticket donations they were supposed to receive but haven’t.

Amid the finger-pointing, questions have been raised about the founder and leader of fledgling San Diego Singles’ Inc., Thomas John Benzing, and his financial dealings.

A one-time tax consultant, financial planner and investment adviser, Benzing, 44, is a man who, when his businesses were flourishing, sported a life style of affluence, made $100,000 a year and drove an $81,000 Rolls-Royce, which he later sold to pay off debts, according to documents filed by his former wife, Marianne, in a divorce suit.

There is, however, another side to Benzing, a portrait of a man at the edge of the law as painted by disgruntled former investors, landlords and the government.

In the past three years, he and his various interlocking companies have been sued no fewer than eight times.

The suits range from disputes over rent owed and accusations by the Internal Revenue Service that Benzing operated an “abusive” tax shelter scheme, to charges that he took funds from a limited partnership for personal use and that he defrauded a Pine Valley couple out of $59,000.

A decade ago, Benzing pleaded guilty to promoting a pyramid scheme, was fined $1,000 and later spent 30 days in the San Diego County Jail for not paying employees in his carpet-cleaning business.

Some members of San Diego Singles’ Society Inc. have also become concerned about Benzing and the finances of the approximately 300-member organization, which bills itself as a tax-exempt corporation that seeks to provide scholarships for underprivileged art students.

IRS officials say they have no record of the San Diego Singles’ Society holding a tax-exempt status. And the state Department of Corporations says that after two warnings, the group’s registration has been revoked because Benzing’s check to the state bounced.

Asked about these matters, Benzing characterized many of the lawsuits as disputes over lease technicalities. He denied defrauding people, claimed ignorance of some suits and said those he was aware of have been resolved.

It was billed as San Diego Symphony Hall’s first-year anniversary party hosted by San Diego Singles’ Society Inc. “This is an especially important time to assist our symphony,” Benzing was quoted in a press release promoting the event. “We plan to raise as much money as possible, with all proceeds to be donated to the symphony’s endowment fund.”

Featured at the 6 to 9 p.m. event were entertainers who donated their services.

Hors d’oeuvres worth a few thousand dollars were contributed by well-known restaurants such as Piret’s, Rainwater’s and Fat City. And a host of other merchants donated door prizes--dinners for two, weekend trips and jazzercise lessons--that were raffled off.

Benzing says the event attracted about 700 people. Symphony officials think the attendance was closer to 1,000, but they don’t know for sure because they relied on Benzing for an accounting of attendance, expenses and cash received.

“He didn’t tell us how many people attended or how much was raised,” said Nancy Hafner, spokeswoman for the symphony. “We figure they raised about $10,000 and had about $2,400 in expenses. That leaves about $7,500.”

But, despite two letters from the symphony to Benzing inquiring about the money, symphony officials say they have yet to receive a dollar from any of the tickets sold, a contention Benzing adamantly denies.

He claims he has in fact donated about $8,300 to the symphony from the event, and that there would have been more if the symphony hadn’t hit him with unexpected last-minute expenses.

His donation, he says, consists of $2,465 he paid the symphony for renting the hall--including the cost of bartenders, security and the like--and about $5,900 worth of beer, wine and champagne left over from the party.

As for net ticket proceeds and money from the raffle, Benzing says, there isn’t any left, and that the total amount taken in, which he says was $7,930, was offset by total expenses he says amounted to $7,800, leaving only about $130.

Symphony officials have problems with Benzing’s explanation.

Symphony Executive Director Wesley O. Brustad says the $2,465 expense payment can in no way be described as a contribution. “That’s not a donation,” Brustad said. “Those are out-of-pocket cash expenses . . . that pays for the help, bartenders, the setup (of the hall).”

As for the undrunk alcohol that the symphony now has, Brustad says that Benzing bought the beverages at wholesale prices, and an official with Mesa Distributing Co. Inc., which provided the $2,388 worth of beverages, said they were bought with the symphony’s liquor license. But more important, Brustad said, is that symphony officials had never envisioned that the “proceeds” from the event would consist of either money paid to rent the hall or leftover booze.

“We didn’t know it (the unused alcohol) would be the extent of the donation,” Brustad said. “There is a combination of admission, drinks purchased and other things, and we’ve had no accounting of that.”

Brustad, who stresses that the event was scheduled before he was hired, said he and the symphony are not in a position, because of the institution’s poor financial health and lack of a contract with its musicians, to pursue the matter more aggressively.

“My posture at this time is I can’t be extremely aggressive, given what’s happened here,” Brustad said.

In response, Benzing says that even though he bought the beer, wine and champagne at wholesale price, it’s proper for him to calculate his donation at retail prices. “The value . . . is not what the actual cost would be, the contribution is what it will be sold for,” he said.

Expenses for the event, Benzing claimed, were high because he was figuring on 1,200 people attending the party and many people failed to show up because, as a result of the impasse with musicians, the symphony canceled its season a week before the celebration.

Over the years, Thomas John Benzing has been a founder, officer and principal of various financial companies that have become embroiled in numerous lawsuits.

In March, 1985, the federal government filed a civil lawsuit in U.S. District Court in San Diego against Benzing, several companies and individuals for promoting an “abusive” tax shelter involving the sale and leasing of children’s records.

The government alleged that Benzing and companies for which he was an officer or founder concocted a tax shelter program in the early 1980s in which investors paid anywhere from $7,000 to $21,500 to lease a master recording disc of children’s stories.

In return for the lease, investors were given tax credits and marketing rights to the master discs. Benzing and his partners placed the value of the master discs at between $125,000 to $475,000.

The government, however, claimed it was all a fraud, that the cost of producing a single 7-inch, 45 rpm recording, for example, was really $1,200, not the inflated $125,000.

Under terms of a recent settlement, Benzing is permanently barred from selling or promoting any master-recording tax shelter programs.

In addition, should Benzing decide to sell or promote any type of tax shelter program during the next five years, he must notify the IRS 30 days in advance of any sales, thereby giving the government time to seek a court injunction if it doesn’t approve, said Benzing’s attorney, Sebastian D’Amico of San Diego.

“That was a long time ago, as far as I’m concerned,” Benzing said. “We’ve signed an agreement, and it has been resolved.”

In July, 1984, Benzing and one of his businesses were sued in San Diego for fraudulent misrepresentation, breach of contract and breech of a limited partnership formed to buy an apartment house.

In the suit filed by Fredrick A. Collingwood, a general partner, Benzing was accused of misusing money from the partnership by, among other things, lending himself $8,000 and transferring other money to another of his companies, meanwhile secretly paying himself more than $15,000 in fees and commissions.

The case was settled before a trial, with Benzing agreeing to repay the loan, the overpayments of fees and commissions and resign from the partnership.

There also have been several suits over Benzing’s penchant for not paying rent.

Since 1984, Benzing has been sued no less than five times for owing rent, in most cases leading to his eviction. From plush Mission Valley offices to an expensive home in the hills of Rancho Bernardo, Benzing has left a trail of landlords with court orders to collect the overdue payments. None has met with much success.

“I think any hopes of collecting anything are gone. It’s been two years, and we’re told he doesn’t have any money,” said attorney James Jay Stoffel, who represented Merrill Lynch Mortgage Corp., which evicted Benzing and his former wife, Marianne, from a home they rented in Rancho Bernardo in 1983-84 for $1,850 a month. They still owe $5,300, according to court records.

Attorney Robert Pasulka is after $39,000 in back rent and breach of a 1981 lease agreement by Benzing and his companies.

Pasulka, representing Camino North Properties, said, “We don’t really know if Benzing has any assets. But he’s responsible for the $39,000, if we can get it.”

Some of Benzing’s latest companies have been evicted as recently as August, 1985, with Benzing owing more than $30,000 in back rent and broken lease agreements.

As for the various evictions, Benzing says, some of the leases were the responsibility of his business partners. Others he claims he is either unaware of or the lawsuits were filed even though leases had legally expired and he decided to move on. He denied ever being evicted.

In March, 1976, Benzing, in a bargain with the San Diego district attorney’s office, pleaded guilty to one count of violating the labor code for issuing checks that bounced to his carpet cleaning company’s employees. He served 30 days in the county jail, was placed on three years’ probation and ordered to make restitution in the amount of $6,262.

Two years earlier in Denver, Benzing pleaded guilty and was fined $1,000 for his part in a pyramid scheme involving the sale of oil and gasoline additives, according to court documents on file in Denver.

Benzing said that he worked as a consultant for one of the oil companies and that it was the company that violated the law, not him.

Most recently, on Sept. 4 of last year, Benzing was sued by James and Alice Hoover of Pine Valley, who accused Benzing of fraud. The Hoovers claim they read a newspaper ad taken out by Benzing in which he boasted that he could substantially reduce the tax burden of investors.

The Hoovers--he is a 52-year-old government worker at North Island and she is a school employee--have a combined income of about $50,000 a year and were looking to defer income until retirement. They responded to the ad, then met with Benzing in July of 1985 at his Mission Valley office.

He convinced them to invest in a limited partnership to build apartments in the Phoenix area. He recommended, the Hoovers said, that they mortgage their home, their single biggest asset. They did so, investing the $59,000 they received.

“It looked attractive to me and legitimate,” James Hoover said recently. “He had a real nice, plush office. He was a three-piece suit kind of a guy. He also wanted us to invest in a solar energy thing he had, and he had some IRAs deals, too.”

What the Hoovers did not know, according to their lawsuit, was that Benzing was not a registered investment adviser or tax preparer and that the shares they were sold were not registered with the federal Securities and Exchange Commission.

The Hoovers made a trip to Phoenix to look at the apartment deal they had invested in. “We went down there, . . . and there was nothing as far as we could tell,” James Hoover said.

Worried, Alice Hoover went to Benzing’s office to get an explanation. But “he was gone . . . and there was no forwarding address,” James Hoover said.

D’Amico, the attorney representing Benzing, and Dan DiRe, a lawyer whose firm represents the Hoovers, say they have reached a tentative agreement acknowledging that the Hoovers are entitled to their money back and that Benzing will pay them.

However, D’Amico acknowledges he doesn’t know how Benzing will be able to pay back the $59,000. “That is up to Mr. Benzing,” D’Amico said. DiRe, saying Benzing’s ability to pay is “obviously a concern of ours,” says that until some type of pay-back plan is agreed upon, the agreement will not be final.

Asked about the Hoovers’ lawsuit, Benzing first said he couldn’t comment because “it’s in litigation.” Moments later, though, he claimed he was unaware of the suit. “I’m not aware of it. . . . I’ve not seen it, I’ve not been served.”

As San Diego grows, it attracts more and more young professionals and business people, many of them out-of-towners aching to meet members of the opposite sex. In an attempt to cater to this social market, and also have some fun, several singles groups have sprung up in San Diego in the past few years.

Benzing formed his group in May. It has a three-person board of directors, consisting of Benzing, Andres Cardenes, the concertmaster for the San Diego Symphony, and Benzing’s new wife, Christine.

It costs $35 to join, and about 300 people have. The purpose of the group is raising money to provide scholarships to underprivileged arts students. So far, however, no scholarships have been given, and Benzing says he doesn’t know when such a scholarship program will be functioning.

“That’s one of the things we’d like to start . . . (but) a lot of events haven’t been that successful,” said Benzing in one of two interviews with The Times. One such event was held Aug. 10 at Avanti of La Jolla, an upscale restaurant. For $35 a ticket, young singles were provided a fashion show, dancing and hors d’oeuvres.

“He wrote me a $2,500 bad check,” said Franco Ferrandi, the owner of Avanti, who said about 300 people attended the event. “We provided food for about $10 per person, and he said the party was a flop.”

Unable to collect on the debt, Ferrandi contacted his lawyer, Armando Odorico, who sued Benzing. Odorico says that Benzing has paid back $700 and still owes the restaurant $1,800.

Members have also questioned the organization’s finances. Dan Stone, who works for an international management company, is one of those who is disgruntled.

Stone worked as a volunteer at both the Avanti event and the symphony party, for which he solicited door prizes. Of the Avanti mixer, he says, “I personally gave him (Benzing) $400 to $500 and saw him stick it in his pocket. I later asked for but never got an accounting.

“I confronted Tom Benzing. I got the step-step-two-shuffle. I was assured there’d be some accounting. What I got were some numbers written by a typewriter on a plain sheet of paper, but that didn’t cut it.”

Others, such as Hugh Largey, a moving company official and member of San Diego Singles’ Society, said he also has asked Benzing for a financial accounting but Benzing has put him off. “A lot of this has the appearance of a nonprofit organization,” he said. “So many people (were) drawn into it with the noblest purposes, . . . but now it appears suspect. Something smells sour.”

Officials from the California secretary of state’s office, which oversees the Department of Corporations, say that San Diego Singles’ Inc. registered and received a corporation identification number on April 29 of last year.

However, Benzing’s $227 check bounced, according to Caren Daniels Meade of the secretary of state’s office. Under state law, the secretary of state was required to notify Benzing twice about the faulty payment, and it did so by letter on June 24 and again on July 14.

But Benzing never responded, Daniels Meade said. As a result, the state canceled the registration, meaning San Diego Singles’ Inc. is no longer legally incorporated, she said.

Benzing insisted recently that his organization was in fact registered with the state; he never mentioned the revocation.

Some members of the San Diego Singles’ Society, such as board member Andres Cardenes, say Benzing is being unfairly criticized by group members who have “an ax” to grind.

Cardenes, who said he was unaware of Benzing’s background or such things as the bounced check at Avanti, said he’s irritated by those who are trying to “stir up all kinds of trouble” for the group, and “almost accusing us of stealing money.”

He says, for example, that the group’s most recent event on Dec. 26 at the Kona Kai Club raised $3,100 for symphony musicians and that the failure of the November symphony party is the fault of the symphony’s management.

Though Cardenes admitted that he “can’t be 100% sure where . . . every penny has gone,” he said Benzing has been honest and straightforward with him.

Meanwhile, people such as Stone say they have had enough and are leaving the group. He says he feels he’s unwittingly deceived businesses from which he solicited door prizes for the November symphony party. In exchange for the contributions, he said, there was supposed to be a large donor board at the party and recognition in the form of a letter or an advertisement, but neither was done.

“My concern is that I went out and represented myself and what I was doing as for the symphony,” he said. “I was rah-rahing everybody, and now we all feel like we’ve been had. I’m getting out of the damn thing . . . just going to walk away from it. From a moral standpoint, I feel uncomfortable. I feel I misled them (the merchants). . . . I have an obligation to do it right.”