On Aug. 3, Judge Peter G. Sheridan, U.S. District Court in Newark, sentenced Fingerhut to two years in prison and three years of supervised release (including four months of home confinement). The previous day, the 63-year-old Fingerhut paid $11 million in restitution required under his plea agreement, says a federal press release.

Ristow was not named in the indictment filed against Fingerhut and vice versa. But on Sept. 24, four months after Fingerhut's plea, Ristow was charged by indictment in federal court.

He pleaded guilty at the time and is to be sentenced on Jan. 4 said David Rosenfeld, associate regional director of the Securities and Exchange Commission in New York City. According to the Department of Justice, Ristow remains free on $100,000 bond.

"He did plead guilty and entered into a settlement agreement with us," Rosenfeld said. "Mr. Ristow consented to the entry of a permanent injunction against violations" of a section and rule of the Security Exchange Act.

"It's a general anti-fraud provision. He has agreed to forfeit the amount equivalent to his ill-gotten gains," Rosenfeld said. The sum Ristow must pay is $2.85 million, he added.

Michael F. Buchanan, assistant U.S. attorney in Newark, N.J., said a claim for civil penalties is pending against Ristow. He and Fingerhut were charged with "very similar" crimes, he said.

Asked if either man had involved SUWA in their illegal dealings, Rosenfeld said the organization was not a party to any action brought against Fingerhut or Ristow.

Not only were they charged with the same type of conspiracy, but a major bank involved in the the schemes is cited in the indictment against each: the Provident Bank, "a New Jersey-chartered mutual savings bank headquartered in Jersey City," says each indictment.

According to the charge against Ristow, he and unindicted co-conspirators as well as others conspired to devise a fraudulent scheme to purchase and sell securities owned by Provident Financial Services (PFS). The two named by initials are not named as defendants in the indictment.

Provident Bank was converting from a mutual savings bank to a capital stock savings bank, and the former would become a wholly-owned subsidiary of PFS.

Shares of PFS stock would be offered to depositors in Provident Bank as part of the conversion. However, says the indictment, Ristow conspired to fraudulently obtain shares in the offerings by PFS and other banks by circumventing rules intended to restrict the maximum number of shares people could have who were acting in concert, and by circumventing rules that prohibited people from entering into agreements to transfer their shares.

It adds that Ristow supplied co-conspirators with "funds to open depository accounts in their names and in the names of others at mutual banks across the United States that defendant Ristow identified as likely to convert to stock savings banks through IPOs."

The indictment says co-conspirators would sell the fraudulently obtained stocks on the open market and send part of the proceeds to Ristow.

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E-mail: bau@desnews.com