UPDATE, 2:07 p.m.:
Darien GOP Chairman Bob Bewkes says he's frustrated that under the terms of a settlement with the Securities and Exchange Commission he can't talk to the news media about the insider trading charges that were filed against him in 2003.
"When I agreed to that at the time, it never occurred to me that I might want to defend myself in public later," Bewkes said in an interview Friday afternoon.
Under the terms of the settlement, Bewkes and his father, E. Garrett "Garry" Bewkes Jr. paid fines and were banned from acting as financial advisors or trading stocks for five years. Neither father nor son were required to admit any guilt in the matter.
Unnamed S.E.C. officials involved in the Bewkes case told the New York Times that it was not a major case, described it as a quick decision (within minutes) on the son's part to take advantage of information he had just received from his father, and they noted that the father and son cooperated with authorities and offered to settle the case.
When the ban expired in 2009, Bob Bewkes said, he didn't reapply for permission to trade again. He is now a real estate agent.
Bewkes was selected to become a member of the Republican Town Committee in September 2010. During the RTC's selection process, he said, he was asked about the events that led up to the S.E.C. case against him, and he explained what happened and why he thought he would nevertheless be a good candidate for membership.
Bewkes said he told the committee that he's lived in Darien for all of his 56 years and knows lots of people in town. "I thought I could bring helpful fundraising leadership and outreach to the party, hopefully with a positive attitude."
In July 2011, after the top leadership of the Republican Town Committee resigned, several members asked Bewkes to run for chairman. He was elected to fill out the rest of the term. Another election is scheduled for the committee's meeting in March.
Bewkes said no one brought up to him the events of 2003 to 2004 at the time he was elected chairman. When he was running for election to that post, he said his main strengths as chairman would be to foster openness in the committee, "to make sure that everyone on the committee gets to have their say," and to keep the organization running smoothly.
One of he main tasks of the Republican Town Committee is to vet candidates for public office, helping the public to avoid candidates they might not want to elect because of the candidates' past histories.
Bewkes was asked whether or not he'd support someone as a candidate for public office if that person had a similar history of S.E.C. charges. He said that he and the committee would have to look into the circumstances, and if they were similar to his own, he could support that person for some elected positions—along with membership on the RTC—but probably not for a major office like first selectman.
He also pointed out that RTC decisions on endorsements and nominations are made by the whole committee, not just himself or himself and a few others.
ORIGINAL ARTICLE: "Darien GOP Chair Banned in 2004 from Finance Industry"
The entire was aware when Bob Bewkes was elected to head that body that he had been cited by federal authorities in 2003 on insider trading charges and had reached a civil settlement with them in 2004.
And when Bewkes first was being considered as a member of the RTC, "He was questioned directly about the matter during his interview and we were satisfied with his answers," John V. Boulton, vice chairman of the Darien RTC, said in a statement released on behalf of the committee.
In a brief telephone interview, Boulton said that when Bewkes put his name forward for the chairmanship of the RTC, that body as a whole, not just a committee or group within it, was aware of the matter and decided it shouldn't prevent Bewkes from the post.
Under the terms of the settlement, Bewkes agreed to a five-year ban from the securities industry, according to the U.S. Securities and Exchange Commission. He paid $137,306 in penalties, according to a statement released by the SEC on April 7, 2004.
What happened, according to the S.E.C.
According to the S.E.C., Bewkes' father, E. Garrett "Garry" Bewkes Jr., had called him at his Darien home one morning in Feb. 2, 2003, and told him that Interstate Bakeries Corp., where the father was on the board of directors, was in "lousy" financial shape, and suggested to his son that he sell any stock he had in it.
Within 10 minutes, according to the SEC, Bob Bewkes started doing just that. The S.E.C. judgment against him said that Bewkes, then a financial advisor at UBS PaineWebber in Stamford, "sold 16,230 shares of IBC stock held in the accounts of himself, his wife, his children, his children's nanny, his best friend, and several other clients."
Nine days later, after IBC announced a downward revision of its earnings estimate, "the price of IBC stock fell from $13.64 per share to $10.22 per share."
Altogether, the S.E.C. estimated, Bewkes saved himself and others $67,517 by selling the stock before the company's problems were made public.
Bewkes' selling attracted the attention of the New York Stock Exchange, which opened an investigation, and that led to the S.E.C. citing both father and son.
In 2004 they proposed a civil settlement that the S.E.C. accepted in which they agreed to pay fines, give up any money gained from the early selling and accept other penalties. Neither of the Bewkeses admitted to wrongdoing.
The five-year ban has long since expired, and Bob Bewkes is entitled to reapply as a financial advisor. He now works as a realtor with Kelly & Associates in Darien.
A telephone message left at Bewkes home on Thursday was not returned.
According to Landon Thomas Jr., writing in the New York Times' business section: "Greed did not seem to be a motive. Robert Bewkes ultimately saved $67,517 in losses for himself and his clients, a relatively modest amount for a veteran stockbroker."
''People in these positions should know better,'' Mark K. Schoenfeld, then a top enforcement official in the S.E.C.'s New York office, told the Times reporter. ''It's a small amount and thus less graphic and venal, but it was still done with an intent to confer a benefit on the son.''
Republican Town Committee's response
The statement Boulton released on behalf of the Republican Town Committee also said:
"This past December, Bob's candidacy for re-election to the RTC was reviewed and recommended by an independent nominating committee, and was subsequently endorsed by the January 2012 Town Republican Caucus.
"Bob has honored the terms of the S.E.C. settlement and we consider the matter closed. Bob’s tenure as RTC Chairman has been marked by openness, integrity, and accountability. He has the RTC’s full support."
Correction: The first quote in the original article from the Darien Republican Town Committee statement about Bob Bewkes (beginning "He was questioned [...]" referred to considering Bewkes for membership in the RTC, not during his candidacy for the chairmanship.