In re DETWILER

 
 
                                                 UNITED                                                 STATES OF AMERICA 
                                                                     Before                                                                     the                                                                     
 SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 56363 / September 6, 2007 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-12750 
 
 
In the Matter of 
 
DETWILER, MITCHELL, 
FENTON & GRAVES, INC.,  
 
Respondent. 
 
 
 
 
 
 
ORDER INSTITUTING ADMINISTRATIVE 
PROCEEDINGS, MAKING FINDINGS, AND 
IMPOSING REMEDIAL SANCTIONS 
PURSUANT TO SECTION 15(b) OF THE 
SECURITIES EXCHANGE ACT OF 1934  
   
 
I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 
public interest that public administrative proceedings be, and hereby are, instituted pursuant to 
Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) against Detwiler, Mitchell, 
Fenton & Graves, Inc. (“DMFG” or “Respondent”).   
 
II. 
 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (the “Offer”) which the Commission has determined to accept.  Solely for the 
purpose of these proceedings and any other proceedings brought by or on behalf of the 
Commission, or to which the Commission is a party, and without admitting or denying the findings 
herein, except as to the Commission’s jurisdiction over Respondent and the subject matter of these 
proceedings, which are admitted, Respondent consents to the entry of this Order Instituting 
Administrative Proceedings, Making Findings, and Imposing Remedial Sanctions Pursuant to 
Section 15(b) of the Securities Exchange Act of 1934 (“Order”), as set forth below.   
 
 
 
 
 

 
2
III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds
1
 that:  
 
Summary 
 
 1. Respondent failed reasonably to supervise Bradford C. Bleidt (“Bleidt”) with a view 
to preventing and detecting his violations of the federal securities laws during the period that Bleidt 
was a DMFG registered representative from October 2001 to February 2004.  During at least this 
time period, Bleidt defrauded approximately 25 of Respondent’s customers by lying about 
purchases and sales of securities, misappropriating funds, and sending them falsified statements 
relating to their investment advisory accounts with Bleidt’s independent advisory firm. 
 
Respondent 
 
2.         Respondent         DMFG         is         a Massachusetts corporation, headquartered in Boston, 
Massachusetts, and a wholly-owned subsidiary of Detwiler, Mitchell & Co., a publicly traded 
holding company.  DMFG has been registered with the Commission since 1971 as a broker-dealer 
pursuant to Section 15(b) of the Exchange Act and since 2006 as an investment adviser pursuant to 
Section 203(a) of the Investment Advisers Act of 1940 (“Advisers Act”).   
 
Other Relevant Person 
 
 3. Bleidt, 53, was a registered representative associated with DMFG in a Boston, 
Massachusetts Office of Supervisory Jurisdiction (“OSJ”) from October 9, 2001 until February 12, 
2004.   
 
 4. On November 12, 2004, the Commission filed a civil injunctive action in the United 
States District Court for the District of Massachusetts against Bleidt and his investment advisory 
firm, Allocation Plus Asset Management Company, Inc. (“APAM”), alleging that Bleidt defrauded 
his investment advisory clients of millions of dollars by leading them to believe their money was 
invested when in fact he was misappropriating it for his own personal benefit.  Many of Bleidt’s 
advisory clients also maintained brokerage accounts at Respondent.  In that proceeding, the 
Commission sought appointment of a receiver, which the court granted.  Among other things, the 
receiver brokered a settlement between DMFG and its former customers pursuant to which DMFG 
made a voluntary payment to a settlement fund, which the receiver distributed to victims.  
 
 5. On July 26, 2005, Bleidt pled guilty to federal charges of mail fraud and money 
laundering in connection with his fraudulent conduct.  On December 5, 2005, Bleidt was sentenced 
to over 11 years of confinement.  
 
 
                                                 
1
 The findings herein are made pursuant to Respondent's Offer of Settlement and are not binding 
on any other person or entity in this or any other proceeding. 

 
3
Bleidt’s Misconduct 
 
6. From October 2001 to February 2004, Bleidt misappropriated over $9 million from 
approximately 25 customers of Respondent.
2
  To perpetrate these misappropriations, he asked his 
customers to request full or partial liquidation of their brokerage accounts with Respondent, and 
then, after they received the funds or their bank received the funds on their behalf, to write a check 
(or in some cases, send a wire) for the amount liquidated to APAM, his investment advisory 
company.  APAM was an independent investment adviser registered under the Advisers Act and 
not affiliated with or controlled by DMFG.  APAM did business out of the same office as the OSJ.  
Bleidt falsely represented to these customers that their money would continue to be invested in 
securities when, in fact, he misappropriated their funds.  Bleidt then deposited these funds into an 
APAM bank account, of which he had sole control.  Bleidt used funds from this APAM account 
for various business enterprises, including operating a Boston radio station, as well as APAM and a 
related financial planning firm.  He also used the customers’ misappropriated funds to pay personal 
expenses.   
 
7. To further conceal his misappropriations and false representations, Bleidt created 
and sent his defrauded customers falsified performance reports in the name of APAM that vastly 
overstated the actual value of the accounts, reflected holdings that did not exist, and reflected 
purchases and sales of securities that he claimed to have made through DMFG, but never did.  
 
8. As a result of the conduct described above, Bleidt, during the period that he was a 
registered representative with Respondent, willfully violated Section 10(b) of the Exchange Act 
and Rule 10b-5 thereunder, which prohibit fraudulent conduct in connection with the purchase or 
sale of securities. 
 
Respondent’s Failure to Supervise
 
 
9. While Bleidt was a registered representative associated with DMFG, he also owned 
the independent office in Boston at which Respondent established an OSJ.  Prior to affiliating with 
Respondent, Bleidt hired the OSJ manager as his employee, and only Bleidt had the ability to 
increase or decrease his salary.  While Bleidt could terminate him as his employee, DMFG had the 
ability to terminate him as OSJ manager.  By allowing a person subordinate to Bleidt to supervise 
Bleidt’s activities concerning Respondent’s business, Respondent created an inherent risk that 
Bleidt would not be adequately supervised.  The OSJ manager’s subordinate status may have 
compromised his ability to supervise Bleidt in a reasonable manner.  This structure may have been 
a contributing factor in the supervisory failures described below.   
 
 
 
                                                 
2
 In the same time period, Bleidt misappropriated approximately another $5 million from 
approximately 43 additional victims who did not have brokerage accounts at DMFG, but from whom Bleidt 
received funds directly in the form of a personal check or wire to APAM.
 

 
4
Failure to Implement Existing Supervisory Procedures to Monitor and Review Outside 
Business Activities  
 
10. While a registered representative of Respondent, Bleidt was pursuing other business 
interests from the same office in which he conducted brokerage activity through Respondent.  
Respondent’s personnel were aware that he conducted outside business activities, including the 
two SEC-registered investment advisory businesses and ownership in a radio station.  Despite the 
existence of written procedures regarding outside business activities of its registered 
representatives, Respondent failed to monitor the outside business activities of Bleidt.  For 
example, DMFG personnel did not reasonably investigate how Bleidt was funding his activities.  
In addition, no one at Respondent investigated the source of initial and ongoing capital for Bleidt’s 
radio station venture.  In fact, these outside business activities were being funded by Bleidt with 
misappropriated funds.  If Respondent had reasonably implemented its existing procedures for 
review of outside business activities, it is likely that the firm could have prevented and detected 
Bleidt’s violations of the federal securities laws. 
 
Failure to Implement Existing Supervisory Procedures for Review of Incoming Mail 
 
11. Incoming mail at the OSJ was sorted, unopened and unreviewed, into registered 
representatives’ mailboxes during the entire time that Bleidt was a registered representative of 
Respondent.  The lack of review of incoming mail enabled Bleidt to receive checks and related 
correspondence from Respondent’s customers who had liquidated their brokerage accounts.  These 
checks were typically in amounts mirroring the amounts liquidated and were sent to Bleidt for the 
purpose of purchasing securities.  Respondent failed reasonably to implement its incoming mail 
procedures.  For example, although Respondent’s written procedures required central mail opening 
at the OSJ where Bleidt was located, this procedure was not followed at the OSJ and not enforced 
by Respondent.  If Respondent had reasonably implemented existing procedures, it is likely that 
the firm could have prevented and detected Bleidt’s violations of the federal securities laws. 
 
Conclusions 
 
 12. Under Section 15(b)(4)(E) of the Exchange Act, broker-dealers are responsible for 
reasonably supervising, with a view to preventing violations of the federal securities laws, persons 
subject to their supervision.  DMFG was responsible for supervising Bleidt.   
 
13.       The       Commission       has repeatedly emphasized that the “responsibility of broker-
dealers to supervise their employees by means of effective, established procedures is a critical 
component in the federal investor protection scheme regulating the securities markets.”  Dean 
Witter Reynolds, Inc., Exchange Act Rel. No. 46578 (October 1, 2002).  Section 15(b)(4)(E) 
provides that a broker-dealer may discharge this responsibility by having “established procedures, 
and a system for applying such procedures, which would reasonably be expected to prevent and 
detect” such violations. “Where there has been an underlying violation of the federal securities 
laws, the failure to have or follow compliance procedures has frequently been found to evidence a 
failure reasonably to supervise the primary violator.”  In the Matter of William V. Giordano, 
Exchange Act Rel. No. 36742 (January 19, 1996). In addition to adopting effective procedures for 

 
5
supervision, broker-dealers “must provide effective staffing, sufficient resources and a system of 
follow up and review to determine that any responsibility to supervise delegated to compliance 
officers, branch managers and other personnel is being diligently exercised.”  In the Matter of 
Mabon, Nugent & Co., Exchange Act Rel. No. 19424 (January 13, 1983). 
 
14. Because Bleidt violated Section 10(b) of the Exchange Act and Rule 10b-5 
thereunder, and DMFG failed to implement existing procedures, DMFG failed reasonably to 
supervise Bleidt for purposes of Section 15(b)(4)(E) of the Exchange Act. 
 
DMFG’s Remedial Efforts  
 
15. In determining to accept the Offer, the Commission considered the remedial acts 
promptly undertaken by Respondent and cooperation afforded the Commission staff.  
 
IV. 
 
 In view of the foregoing, the Commission deems it appropriate and in the public interest to 
impose the sanctions agreed to in Respondent DMFG’s Offer. 
 
 Accordingly, pursuant to Section 15(b) of the Exchange Act, it is hereby ORDERED that: 
 
 A. Respondent DMFG be, and hereby is, censured pursuant to Section 15(b)(4) of the 
Exchange Act. 
 
 B. Respondent shall, within ten days of the entry of this Order, pay disgorgement of $1 
and a civil money penalty in the amount of $250,000 to the Securities and Exchange Commission. 
Such payment shall be: (A) made by United States postal money order, certified check, bank 
cashier's check or bank money order; (B) made payable to the Securities and Exchange 
Commission; (C) hand-delivered or mailed to the Office of Financial Management, Securities and 
Exchange Commission, Operations Center, 6432 General Green Way, Stop 0-3, Alexandria, VA 
22312; and (D) submitted under cover letter that identifies DMFG as a Respondent in these 
proceedings, the file number of these proceedings, a copy of which cover letter and money order or 
check shall be sent to David P. Bergers, Regional Director, Securities and Exchange Commission, 
33 Arch Street, 23
rd
 Floor, Boston, Massachusetts 02110.    
 
C. It is further ordered that the disgorgement and penalties referenced in paragraph B 
above shall be paid into the Fair Fund created pursuant to Section 308(a) of the Sarbanes-Oxley 
Act of 2002 in In the Matter of Commonwealth Equity Services, LLP d/b/a Commonwealth 
Financial Network, Administrative Proceeding File No. 3-12749 (34-56362).  Regardless of 
whether any such Fair Fund distribution is made, amounts ordered to be paid as civil money 
penalties pursuant to this Order shall be treated as penalties paid to the government for all 
purposes, including all tax purposes.  To preserve the deterrent effect of the civil penalty, 
Respondent agrees that it shall not, after offset or reduction in any Related Investor Action based 
on Respondent’s payment of disgorgement in this action, argue that it is entitled to, nor shall it 
further benefit by offset or reduction of any part of Respondent’s payment of a civil penalty in this 

 
6
action ("Penalty Offset").  If the court in any Related Investor Action grants such a Penalty Offset, 
Respondent agrees that it shall, within 30 days after entry of a final order granting the Penalty 
Offset, notify the Commission's counsel in this action and pay the amount of the Penalty Offset to 
the United States Treasury or to a Fair Fund, as the Commission directs.  Such a payment shall not 
be deemed an additional civil penalty and shall not be deemed to change the amount of the civil 
penalty imposed in this proceeding.  For purposes of this paragraph, a "Related Investor Action" 
means a private damages action brought against Respondent by or on behalf of one or more 
investors based on substantially the same facts as alleged in the Order instituted by the 
Commission in this proceeding. 
 
 
            By            the            Commission.            
 
 
 
       Nancy M. Morris 
       Secretary 

UNITED STATES OF AMERICA 
 Before the 
 SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 56363 / September 6, 2007 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-12750 
 
 
In the Matter of 
 

DETWILER, MITCHELL, 
FENTON & GRAVES, INC.,  

 
Respondent. 
 
 
 

 
 
 
ORDER INSTITUTING ADMINISTRATIVE 
PROCEEDINGS, MAKING FINDINGS, AND 
IMPOSING REMEDIAL SANCTIONS 
PURSUANT TO SECTION 15(b) OF THE 
SECURITIES EXCHANGE ACT OF 1934  

   
 

I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 
public interest that public administrative proceedings be, and hereby are, instituted pursuant to 
Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) against Detwiler, Mitchell, 
Fenton & Graves, Inc. (“DMFG” or “Respondent”).   

 
II. 

 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (the “Offer”) which the Commission has determined to accept.  Solely for the 
purpose of these proceedings and any other proceedings brought by or on behalf of the 
Commission, or to which the Commission is a party, and without admitting or denying the findings 
herein, except as to the Commission’s jurisdiction over Respondent and the subject matter of these 
proceedings, which are admitted, Respondent consents to the entry of this Order Instituting 
Administrative Proceedings, Making Findings, and Imposing Remedial Sanctions Pursuant to 
Section 15(b) of the Securities Exchange Act of 1934 (“Order”), as set forth below.   
 
 
 
 
 



 2

III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds1 that:  
 

Summary 
 
 1. Respondent failed reasonably to supervise Bradford C. Bleidt (“Bleidt”) with a view 
to preventing and detecting his violations of the federal securities laws during the period that Bleidt 
was a DMFG registered representative from October 2001 to February 2004.  During at least this 
time period, Bleidt defrauded approximately 25 of Respondent’s customers by lying about 
purchases and sales of securities, misappropriating funds, and sending them falsified statements 
relating to their investment advisory accounts with Bleidt’s independent advisory firm. 
 

Respondent 
 

2. Respondent DMFG is a Massachusetts corporation, headquartered in Boston, 
Massachusetts, and a wholly-owned subsidiary of Detwiler, Mitchell & Co., a publicly traded 
holding company.  DMFG has been registered with the Commission since 1971 as a broker-dealer 
pursuant to Section 15(b) of the Exchange Act and since 2006 as an investment adviser pursuant to 
Section 203(a) of the Investment Advisers Act of 1940 (“Advisers Act”).   

 
Other Relevant Person 

 
 3. Bleidt, 53, was a registered representative associated with DMFG in a Boston, 
Massachusetts Office of Supervisory Jurisdiction (“OSJ”) from October 9, 2001 until February 12, 
2004.   
 
 4. On November 12, 2004, the Commission filed a civil injunctive action in the United 
States District Court for the District of Massachusetts against Bleidt and his investment advisory 
firm, Allocation Plus Asset Management Company, Inc. (“APAM”), alleging that Bleidt defrauded 
his investment advisory clients of millions of dollars by leading them to believe their money was 
invested when in fact he was misappropriating it for his own personal benefit.  Many of Bleidt’s 
advisory clients also maintained brokerage accounts at Respondent.  In that proceeding, the 
Commission sought appointment of a receiver, which the court granted.  Among other things, the 
receiver brokered a settlement between DMFG and its former customers pursuant to which DMFG 
made a voluntary payment to a settlement fund, which the receiver distributed to victims.  
 
 5. On July 26, 2005, Bleidt pled guilty to federal charges of mail fraud and money 
laundering in connection with his fraudulent conduct.  On December 5, 2005, Bleidt was sentenced 
to over 11 years of confinement.  
 
 

                                                 
1 The findings herein are made pursuant to Respondent's Offer of Settlement and are not binding 

on any other person or entity in this or any other proceeding. 



 3

Bleidt’s Misconduct 
 

6. From October 2001 to February 2004, Bleidt misappropriated over $9 million from 
approximately 25 customers of Respondent.2  To perpetrate these misappropriations, he asked his 
customers to request full or partial liquidation of their brokerage accounts with Respondent, and 
then, after they received the funds or their bank received the funds on their behalf, to write a check 
(or in some cases, send a wire) for the amount liquidated to APAM, his investment advisory 
company.  APAM was an independent investment adviser registered under the Advisers Act and 
not affiliated with or controlled by DMFG.  APAM did business out of the same office as the OSJ.  
Bleidt falsely represented to these customers that their money would continue to be invested in 
securities when, in fact, he misappropriated their funds.  Bleidt then deposited these funds into an 
APAM bank account, of which he had sole control.  Bleidt used funds from this APAM account 
for various business enterprises, including operating a Boston radio station, as well as APAM and a 
related financial planning firm.  He also used the customers’ misappropriated funds to pay personal 
expenses.   

 
7. To further conceal his misappropriations and false representations, Bleidt created 

and sent his defrauded customers falsified performance reports in the name of APAM that vastly 
overstated the actual value of the accounts, reflected holdings that did not exist, and reflected 
purchases and sales of securities that he claimed to have made through DMFG, but never did.  

 
8. As a result of the conduct described above, Bleidt, during the period that he was a 

registered representative with Respondent, willfully violated Section 10(b) of the Exchange Act 
and Rule 10b-5 thereunder, which prohibit fraudulent conduct in connection with the purchase or 
sale of securities. 

 
Respondent’s Failure to Supervise 

 
9. While Bleidt was a registered representative associated with DMFG, he also owned 

the independent office in Boston at which Respondent established an OSJ.  Prior to affiliating with 
Respondent, Bleidt hired the OSJ manager as his employee, and only Bleidt had the ability to 
increase or decrease his salary.  While Bleidt could terminate him as his employee, DMFG had the 
ability to terminate him as OSJ manager.  By allowing a person subordinate to Bleidt to supervise 
Bleidt’s activities concerning Respondent’s business, Respondent created an inherent risk that 
Bleidt would not be adequately supervised.  The OSJ manager’s subordinate status may have 
compromised his ability to supervise Bleidt in a reasonable manner.  This structure may have been 
a contributing factor in the supervisory failures described below.   

 
 

 

                                                 
2 In the same time period, Bleidt misappropriated approximately another $5 million from 

approximately 43 additional victims who did not have brokerage accounts at DMFG, but from whom Bleidt 
received funds directly in the form of a personal check or wire to APAM. 



 4

Failure to Implement Existing Supervisory Procedures to Monitor and Review Outside 
Business Activities  

 
10. While a registered representative of Respondent, Bleidt was pursuing other business 

interests from the same office in which he conducted brokerage activity through Respondent.  
Respondent’s personnel were aware that he conducted outside business activities, including the 
two SEC-registered investment advisory businesses and ownership in a radio station.  Despite the 
existence of written procedures regarding outside business activities of its registered 
representatives, Respondent failed to monitor the outside business activities of Bleidt.  For 
example, DMFG personnel did not reasonably investigate how Bleidt was funding his activities.  
In addition, no one at Respondent investigated the source of initial and ongoing capital for Bleidt’s 
radio station venture.  In fact, these outside business activities were being funded by Bleidt with 
misappropriated funds.  If Respondent had reasonably implemented its existing procedures for 
review of outside business activities, it is likely that the firm could have prevented and detected 
Bleidt’s violations of the federal securities laws. 

 
Failure to Implement Existing Supervisory Procedures for Review of Incoming Mail 
 

11. Incoming mail at the OSJ was sorted, unopened and unreviewed, into registered 
representatives’ mailboxes during the entire time that Bleidt was a registered representative of 
Respondent.  The lack of review of incoming mail enabled Bleidt to receive checks and related 
correspondence from Respondent’s customers who had liquidated their brokerage accounts.  These 
checks were typically in amounts mirroring the amounts liquidated and were sent to Bleidt for the 
purpose of purchasing securities.  Respondent failed reasonably to implement its incoming mail 
procedures.  For example, although Respondent’s written procedures required central mail opening 
at the OSJ where Bleidt was located, this procedure was not followed at the OSJ and not enforced 
by Respondent.  If Respondent had reasonably implemented existing procedures, it is likely that 
the firm could have prevented and detected Bleidt’s violations of the federal securities laws. 
 
Conclusions 
 
 12. Under Section 15(b)(4)(E) of the Exchange Act, broker-dealers are responsible for 
reasonably supervising, with a view to preventing violations of the federal securities laws, persons 
subject to their supervision.  DMFG was responsible for supervising Bleidt.   
 

13. The Commission has repeatedly emphasized that the “responsibility of broker-
dealers to supervise their employees by means of effective, established procedures is a critical 
component in the federal investor protection scheme regulating the securities markets.”  Dean 
Witter Reynolds, Inc., Exchange Act Rel. No. 46578 (October 1, 2002).  Section 15(b)(4)(E) 
provides that a broker-dealer may discharge this responsibility by having “established procedures, 
and a system for applying such procedures, which would reasonably be expected to prevent and 
detect” such violations. “Where there has been an underlying violation of the federal securities 
laws, the failure to have or follow compliance procedures has frequently been found to evidence a 
failure reasonably to supervise the primary violator.”  In the Matter of William V. Giordano, 
Exchange Act Rel. No. 36742 (January 19, 1996). In addition to adopting effective procedures for 



 5

supervision, broker-dealers “must provide effective staffing, sufficient resources and a system of 
follow up and review to determine that any responsibility to supervise delegated to compliance 
officers, branch managers and other personnel is being diligently exercised.”  In the Matter of 
Mabon, Nugent & Co., Exchange Act Rel. No. 19424 (January 13, 1983). 

 
14. Because Bleidt violated Section 10(b) of the Exchange Act and Rule 10b-5 

thereunder, and DMFG failed to implement existing procedures, DMFG failed reasonably to 
supervise Bleidt for purposes of Section 15(b)(4)(E) of the Exchange Act. 

 
DMFG’s Remedial Efforts  

 
15. In determining to accept the Offer, the Commission considered the remedial acts 

promptly undertaken by Respondent and cooperation afforded the Commission staff.  
 

IV. 
 

 In view of the foregoing, the Commission deems it appropriate and in the public interest to 
impose the sanctions agreed to in Respondent DMFG’s Offer. 
 
 Accordingly, pursuant to Section 15(b) of the Exchange Act, it is hereby ORDERED that: 
 
 A. Respondent DMFG be, and hereby is, censured pursuant to Section 15(b)(4) of the 
Exchange Act. 
 
 B. Respondent shall, within ten days of the entry of this Order, pay disgorgement of $1 
and a civil money penalty in the amount of $250,000 to the Securities and Exchange Commission. 
Such payment shall be: (A) made by United States postal money order, certified check, bank 
cashier's check or bank money order; (B) made payable to the Securities and Exchange 
Commission; (C) hand-delivered or mailed to the Office of Financial Management, Securities and 
Exchange Commission, Operations Center, 6432 General Green Way, Stop 0-3, Alexandria, VA 
22312; and (D) submitted under cover letter that identifies DMFG as a Respondent in these 
proceedings, the file number of these proceedings, a copy of which cover letter and money order or 
check shall be sent to David P. Bergers, Regional Director, Securities and Exchange Commission, 
33 Arch Street, 23rd Floor, Boston, Massachusetts 02110.    
 

C. It is further ordered that the disgorgement and penalties referenced in paragraph B 
above shall be paid into the Fair Fund created pursuant to Section 308(a) of the Sarbanes-Oxley 
Act of 2002 in In the Matter of Commonwealth Equity Services, LLP d/b/a Commonwealth 
Financial Network, Administrative Proceeding File No. 3-12749 (34-56362).  Regardless of 
whether any such Fair Fund distribution is made, amounts ordered to be paid as civil money 
penalties pursuant to this Order shall be treated as penalties paid to the government for all 
purposes, including all tax purposes.  To preserve the deterrent effect of the civil penalty, 
Respondent agrees that it shall not, after offset or reduction in any Related Investor Action based 
on Respondent’s payment of disgorgement in this action, argue that it is entitled to, nor shall it 
further benefit by offset or reduction of any part of Respondent’s payment of a civil penalty in this 



 6

action ("Penalty Offset").  If the court in any Related Investor Action grants such a Penalty Offset, 
Respondent agrees that it shall, within 30 days after entry of a final order granting the Penalty 
Offset, notify the Commission's counsel in this action and pay the amount of the Penalty Offset to 
the United States Treasury or to a Fair Fund, as the Commission directs.  Such a payment shall not 
be deemed an additional civil penalty and shall not be deemed to change the amount of the civil 
penalty imposed in this proceeding.  For purposes of this paragraph, a "Related Investor Action" 
means a private damages action brought against Respondent by or on behalf of one or more 
investors based on substantially the same facts as alleged in the Order instituted by the 
Commission in this proceeding. 

 
 

 By the Commission. 
 
 
 
       Nancy M. Morris 
       Secretary 


	 UNITED STATES OF AMERICA 
	 
	 
	In the Matter of 
	 
	DETWILER, MITCHELL, FENTON & GRAVES, INC.,  
	 
	Respondent. 
	Respondent 
	Other Relevant Person 
	Bleidt’s Misconduct 
	Respondent’s Failure to Supervise 
	DMFG’s Remedial Efforts  
	IV.