First Pension Accounts May Go to Cal-Trust : Retirement funds: Clients of failed investment firm are given hope of access to money.

More than 200 angry clients of failed First Pension Corp. packed a hearing room in U.S. Bankruptcy Court Tuesday for an update on the failed Irvine pension management firm.

Trustee James Joseph said a deal is underway to turn over client accounts to California Central Trust Bank, a Costa Mesa trust company with about $155.7 million in assets.

If approved by the bankruptcy judge, the company, better known as Cal-Trust, would begin to manage accounts for First Pension’s nearly 8,000 clients--giving them access to their retirement funds for the first time since all company assets were frozen in late April.

The U.S. Securities and Exchange Commission alleges that First Pension’s owners operated an elaborate pyramid scheme, leading clients to invest in mortgages that did not exist. As much as $124 million of investors’ money may have been lost to fraud and outright theft, investigators say.

Joseph said Tuesday that $350,000 in investor funds has been recovered from an account in Singapore.

“That Singapore money has been returned to the receiver, and we are expecting to recover other funds as part of the plea agreement,” Joseph said. “It’s a serious situation, we’re all frustrated.”

The three principals, William E. Cooper, Robert E. Lindley and Valerie Jensen, did not attend the hearing. Earlier this month, all three agreed to plead guilty to unspecified future criminal charges stemming from an investigation into the workings of First Pension.

There is a separate trustee for Summit Trust Services, a Denver-based firm established by Cooper to handle his clients’ money, who did not attend Tuesday’s hearing.