SEC Sues Businessman in Towers Case

A businessman who was supposed to help thousands of victims defrauded by bankrupt Towers Financial Corp. was sued by the Securities and Exchange Commission, which accused him of cheating the same investors. The civil lawsuit, filed in federal court in Manhattan, accused John Hall of Malibu, who was chairman and general partner of Qualis Care LP, and an associate, Joel Ciniero, of running a complex scheme to obtain and loot Towers’ assets during its bankruptcy proceedings. The lawsuit also accused a third defendant, Mark Keckeisen, of aiding in the fraud. All three defendants have pleaded guilty to related criminal charges. The lawsuit seeks repayment of illegal profits plus interest and unspecified penalties. Towers filed for Chapter 11 bankruptcy protection in 1993 after it was found that the company’s former owner, Steven Hoffenberg, used it to operate what prosecutors say was the largest Ponzi scheme in history. He pleaded guilty to conspiracy and fraud charges in 1995.