Eric A. Bloom, chief executive officer of the failed investment firm Sentinel Management Group Inc., fraudulently misled its clients about how their assets were being used, Bloomberg News reported yesterday. “Sentinel was a fraud” led by Bloom, Assistant U.S. Attorney Patrick Otlewski said yesterday in U.S. District Court in Chicago. He asked for “the only verdict consistent with the evidence: a verdict of guilty on all counts.” Bloom was indicted in 2012 charges he and another man cheated at least 70 investors of more than $500 million through Sentinel, a suburban Chicago firm that managed short-term investments for commodity pools, hedge funds, a pension fund and other customers. Sentinel filed for bankruptcy in August 2007 days after Bloom told clients it was freezing their accounts due to financial market turbulence and saying some customers joined in the panic, Otlewski told the jury in his closing arguments. In fact, the firm had been using client assets as collateral for loans taken from the Bank of New York Mellon Corp., putting that money toward its heavily leveraged house trading account, Otlewski said.
