Sentinel Management Group Inc. Its list of creditors with the 20 largest unsecured claims includes four Chicago-area firms: Chapter 11 allows a business to operate as it reorganizes its finances through a court-approved plan. Numerous other local creditors listed include Alaron Clearing LLC, the Chicago Bears, the Chicago Tribune and Levy Restaurants. The bankruptcy filing came as clients began hitting Sentinel with lawsuits, accusing it of selling assets too cheaply and without approval.

On Thursday it was revealed that Sentinel had sold hundreds of millions of dollars in assets to giant Chicago hedge fund Citadel Investment Group. Penson GHCO, the futures-clearing subsidiary of publicly traded Penson Worldwide Inc. Earlier Friday, Penson said in a statement Sentinel sold some of its assets without approval and in breach of contract.

Futures brokers said they used Sentinel to temporarily stash client money. Sentinel promised to obtain the best interest possible consistent with safety and to make money readily available.

Also Friday afternoon, a U. The two Sentinel clients argued before U.

District Judge Ronald Guzman that they would suffer if the sale of Sentinel's assets were allowed to go through at the discount Citadel expected to pay. Guzman's order remains in effect until Aug.

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The order prevents Sentinel from transferring or selling any interests Farr or Velocity placed with Sentinel. In an interview afterward, Roeder said the Farr and Velocity assets account for a "very small" portion of the sale.

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After the hearing, Robert Trizna, a lawyer representing Farr, said his client has been kept in the dark for days. Lawyers representing Sentinel clients have complained that Sentinel could have gotten a better price.

Lawyer Jeffrey Schulman, who represents some non-broker clients of Sentinel, said he knows nothing beyond two letters sent by Sentinel. Sentinel's "Web site is down and phone calls go nowhere," he said. On Tuesday, as news of Sentinel's problems spread, he directed that the assets in his account be transferred to another institution. On Wednesday, Sentinel wasn't answering the phone, so the firm dispatched a worker to Sentinel's Northbrook office.

FCStone can keep $ mln Sentinel bankruptcy payout | Reuters

Sentinel makes Chapter 11 filing. Clients sue over discount asset sale.

August 18, By Becky Yerak and Robert Manor, Tribune staff reporters. Sentinel declined to comment Friday, and a Citadel spokeswoman could not be reached. On Monday, however, the company halted redemptions, citing instability in credit markets.

Meanwhile, the fate of an unknown number of Sentinel's clients remains in limbo. When one partner in a marriage doesn't want sex, what are options? Former Illini football player convicted of sexual assault.

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