International Thoroughbred Breeders, which sold Garden State Park in New Jersey to a real estate development company in November for $30 million, is bracing for a civil action and a probe of "certain current and former officers" by the Securities and Exchange Commission.
A spokesperson for ITB, which has moved its headquarters from the Cherry Hill track to nearby Bellmawr, said the SEC had not informed the company of the nature of the action.
A filing last month by ITB with the federal agency stated that certain officers had been subpoenaed by the SEC in early 2000 in conjunction with certain transactions and reports.
Of the $30 million racetrack sale price, ITB said it used $3.75 million in principal and interest for debt incurred to buy 2.9 million of its common stock from the trustee of the Robert E. Brennan bankruptcy.
Brennan, ITB's former chairman and chief executive officer, was found guilty of bankruptcy fraud in a federal court. He had filed for bankruptcy in 1995 after the SEC won a $78-million judgement. The SEC claimed Brennan had defrauded investors in his First Jersey Securities.