Torrance Sues to Recover $6 Million From Wymer

Torrance filed suit this week against Steven D. Wymer and his once-lauded financial empire in hopes of recapturing $6 million in city money that was discovered missing in December.

The civil lawsuit, filed in U.S. District Court, accuses Wymer of defrauding Torrance of money the city had entrusted to the Irvine-based investment adviser.

City Atty. Kenneth L. Nelson said the suit will give the city subpoena powers that will speed the search for the missing money but he cautioned that the investigation will not be an easy one.

“We need to use the powers we get from this to start looking under more rocks,” Nelson said. The city hopes to track its funds by poring through Wymer’s own records, bank records and brokerage firm files, he said.

Wymer is awaiting trial in a separate criminal case on charges that he stole more than $100 million from clients, including Torrance. The money vanished when Wymer was supposed to be investing it in U.S. Treasury bonds, prosecutors claim. Wymer has pleaded innocent to the charges.

Michael Perlis, an attorney representing Wymer, said Wednesday that he could not respond specifically to Torrance’s claims that Wymer defrauded the city.

Torrance’s lawsuit is the latest chapter in the labyrinthine legal battle that ensued after Wymer’s arrest three months ago. Perlis said legal action is pending on at least four fronts.

The cities of Loma Linda and La Quinta--which, like Torrance, used Wymer’s investment expertise--sued him in January.

Attorneys for Torrance filed their suit one day after a federal judge rejected the city’s attempt to join a separate civil suit filed against Wymer by the Securities and Exchange Commission.

The Torrance attorneys had argued in court Monday that the city should be included in the SEC lawsuit to make the legal effort more efficient. But U.S. District Judge Mariana R. Pfaelzer rejected Torrance’s request after SEC attorneys argued that the city’s presence would make their case more cumbersome.

The city then filed the lawsuit Tuesday against Wymer and his two investment firms, Institutional Treasury Management Inc. and Denman & Co.

The Torrance case may be assigned to Pfaelzer and consolidated with the SEC suit, Nelson said.

In its 18-page lawsuit, the city alleges that Wymer was engaged in “an ongoing fraudulent scheme” to solicit and promote investments for his own use.

Perlis said Wednesday that Wymer “has frequently stated his desire to cooperate with his former clients” and assist them in recovering their money. But Wymer first needs to reach an understanding with prosecutors in the criminal case before he can help his ex-clients, Perlis said.