Receiver Appointed for Pension Advisory Firm

A judge appointed a receiver for National Financial Systems Inc., a Santa Monica pension advisory company that disclosed last summer that a fund it operated held just $7.4 million in assets while it owed investors $14.1 million, the Securities and Exchange Commission said.

U.S. District Judge Stephen V. Wilson removed NFSI from the control of owner Terese Herwick, said Nicolas Morgan, senior trial counsel for the SEC. In a fraud lawsuit seeking fines and the return of ill-gotten gains, the SEC said NFSI sent investors statements crediting them with earnings that can’t be paid and charged undisclosed management fees totaling $1.22 million.

Herwick’s attorney, Mike McCloskey of San Diego, said he would contest the charges because Herwick was following practices used by the fund’s bank trustees before she acquired NFSI in 1999.

-- E. Scott Reckard