An American man jailed in Bermuda last December for trying to open a bank account using false documents is now the subject of legal action from the US Securities and Exchange Commission (SEC).

The SEC subpoenaed Dennis Herula, 54, who is from Tiburon in California, after his release from Bermuda prison and return to the United States.

Mr. Herula had been sentenced to one month in jail after being found guilty of "uttering a forged document" in the process of trying to open an account at the Bank of Bermuda on November 23, 2001.

Mr. Herula allegedly told the bank that he wanted the account to be in the name of Platinum Asset Management, a company he was hoping to set up here.

And he said a cheque for $10 million dollars, which was the proceeds of bond trading, would be credited to the account soon after from a company named Legacy 2000 Inc., based abroad.

However, investigations by the bank showed that Legacy 2000 Inc. did not exist.

Due to suspicions felt by the bank, Police were informed and Herula and his wife were arrested. In court however no evidence was offered against Mr. Herula's wife, Mary Lee Capalbo.

The SEC subpoena was filed on January 9 after Mr. Herula returned to the US. But Mr. Herula refused to turn over financial account records as requested.

Separate action has also been taken against Mrs. Capalbo, a Rhode Island attorney who has also refused to comply with an SEC subpoena.

An SEC litigation release said an SEC litigation release said that Mr. Herula, a former broker at the Cranston, Rhode Island branch of Raymond James Financial Services, Inc., was served the subpoena at the San Francisco Airport. It required him to immediately turn over financial account records and other documents he was carrying into the US from Bermuda.

The statement said that Mr. Herula refused and claimed he had no such documents in his possession.

The SEC alleges that Mr. Herula did have financial account records with him when he was served with the subpoena. The SEC has thus filed an Application for an Order to Show Cause and For an Order Requiring Compliance with Administrative Subpoena Against Dennis S. Herula. The action was filed in Rhode Island federal district court.

The SEC statement added: "On December 26, 2001, the Commission issued an Order Directing Private Investigation and Designating Officers to Take Testimony (Formal Order) in the matter of Brite Business Corporation. The Formal Order authorizes the staff to conduct an investigation into whether Brite Business or others violated the federal securities laws in connection with the solicitation of investments, and whether investor funds subsequently were misappropriated."

According to the SEC Mr. Herula served as broker for at least two Raymond James accounts that may have held millions of dollars in investor funds raised by Brite Business. The Commission staff had been investigating Mr. Herula's activities to determine, among other things, what happened to Brite Business investor funds.

The SEC statement also refers to Mr. Herula's Bermuda conviction and notes that when Mr. Herula was arrested the Bermuda police seized two laptop computers and numerous documents from him. And the Bermuda police have confirmed that the documents and laptops they seized contained financial account information that would have been responsive to the Commission's January 9 subpoena.

The Commission alleges that when Mr. Herula arrived at his final destination in San Francisco on the evening of January 9 he was carrying a black bag similar to the one that had contained the laptops earlier that day. The laptops and documents had reportedly been returned to Mr. Herula by Bermuda Police on January 9 when he boarded a flight for the US. But Mr. Herula claimed the items were not in his possession.

Meanwhile, a separate SEC litigation release states that Mrs. Capalbo was subpoenaed on December 26 to appear for testimony in Boston on December 31. She did not show for that court appointment and she refused to give testimony when she appeared in court on January 16 - a second court date requested by her attorney.

The SEC has now initiated action following Mrs. Capalbo's failure to comply with the subpoena which is in relation to allegations that her husband, Mr. Herula allegedly transferred $15 million from Brite Business accounts to an account held in Mrs. Capalbo's name.