Torrance Funds Being Sought in Wymer Firm : * Scandal: $6.2 million, proceeds from sale of a U.S. Treasury note by Newport financial adviser who is accused of fraud, has disappeared.

City officials are spending a gloomy holiday week tracking $6.2 million that disappeared about two weeks ago after proceeds from the sale of a U.S. Treasury note handled by an allegedly fraudulent Newport Beach investment adviser never reached city accounts.

The $6.2 million--one-eighth of the city’s investment portfolio--is part of millions of dollars that appears to be missing in a financial scandal involving investment adviser Steven D. Wymer. Wymer, who recently resigned from an Irvine-based financial network, was charged last week with securities fraud and mail fraud.

Wymer, who remains in jail after his Dec. 17 arrest, is linked to what investigators say is more than $100 million missing from more than $1.2 billion his companies invested on behalf of cities and other governmental groups in California and 12 other states. Wymer’s criminal attorney could not be reached for comment Thursday.

The court-appointed receiver overseeing Wymer’s former companies--International Treasury Management Inc. and Denman & Co.--said Thursday that he plans to place the companies in bankruptcy next week.

Los Angeles attorney Robert E. Carlson said he would probably seek to liquidate the companies through a Chapter 7 petition next week. In bankruptcy, Carlson said he would attempt to recover large sums of money the companies paid out 90 days prior to the filing to “make a more equitable distribution” of assets among creditors.

“At the moment, I’m very reluctant to pay any creditors so long as cities have substantial claims that have not been resolved,” he said.

However, Carlson has released more than $11 million to California cities this week, including $6.8 million that belongs to Palm Desert, $3.2 million to Hemet City, and $1 million to the Coachella Redevelopment Agency.

Michael B. Jeffers, an attorney representing Orange, said the city’s in the process of filing documents with Carlson to recover $4,032 that’s left of its $7.1 million investment. He said the city is considering “all forms of legal action against the parties involved in this fraud.”

Of Torrance’s money, only $93 remains, city officials have been told. The news has sent tremors through City Hall, where officials are poring over records and tallying finances.

City Treasurer Thomas C. Rupert remembers Wymer as “very clean-cut, well-mannered, (having) beautiful offices . . . just a real gentleman.”

Wymer had handled investments for Torrance for at least 2 1/2 years, officials said. Rupert said he talked to Wymer regularly and received daily documentation of financial transactions involving the city’s money.

Moreover, Wymer’s sales representative for Torrance was former Riverside Treasurer Harold Brewer, a man whom Rupert describes as “my friend for 20 years.”

Rupert said he met with Wymer several times and talked to him on a regular basis. He initially invested $2 million of the city’s money through Wymer and then increased the amount, Rupert said. The service was good, Rupert said, and he received documentation within 24 hours of each trade.

The missing money apparently was tied to the city’s Nov. 15 purchase of a U.S. Treasury note that city officials believe was sold Dec. 9, with Wymer’s International Treasury Management serving as the city’s representative.

“The money didn’t go back into our account,” Rupert said.

City Atty. Kenneth L. Nelson said he plans to hire outside attorneys to try to recover the money.