Bank Told to Return Funds to Iowa Trust : * Courts: Judge says Denver institution should not keep the $43 million apparently misappropriated by money manager Steven D. Wymer.

A federal judge on Friday ordered a bank to return $43 million apparently transferred from the Iowa Trust Fund by Orange County money manager Steven D. Wymer.

U.S. District Judge Lewis T. Babcock rejected arguments by Jefferson Bank & Trust that $43 million deposited Nov. 25 came from a source other than Wymer. Babcock stayed his order 10 days to give Jefferson Bank a chance to appeal.

“Defendant would be unjustly enriched if it retained the funds Wymer misappropriated from the Iowa Trust,” Babcock wrote. “Equity demands that defendant return the property to its rightful owner, the Iowa Trust.”

The Iowa Trust had pooled the idle cash of 88 Iowa cities, counties and local governments for investment with Institutional Treasury Management, an Irvine firm that was also an investment manager for Jefferson Bank. Federal investigators allege ITM’s owner, Wymer, last year diverted more than $100 million from clients in Iowa and other states.

Last December, a federal judge shut down ITM, which managed $1.2 billion in cash and securities for clients. Iowa Trust officials said more than $75 million was missing from its account.

Jefferson Bank President Maurice Grotjohn said in a news statement that he was disappointed by Babcock’s ruling, adding that the bank will appeal it.

Grotjohn had said earlier that a $43-million judgment against his bank would equal a quarter of its assets and hamper the bank’s earnings and ability to trade assets.

Wymer, 43, has been charged in a 43-count federal indictment of securities fraud, mail fraud and money laundering, among other charges. He has pleaded innocent.

If convicted, Wymer could be fined more than $14 million and sentenced to 275 years in prison. A Sept. 15 trial date has been set.