Deadline set for creditors in Slatkin case Claims must be filed by Feb. 28 10/25/01 By MARK VAN DE KAMP NEWS-PRESS STAFF WRITER A deadline was set Wednesday for everyone who invested with bankrupt money manager Reed Slatkin, the local man accused of duping approximately 850 people out of $500 million while running an unregistered investment club for 15 years. All creditors have until Feb. 28 to file their proofs of claims with the U.S. Bankruptcy Court in Santa Barbara. Many are people who entrusted Mr. Slatkin with their savings and college funds. Where the money went is still unknown. Mr. Slatkin is being investigated but has not been charged. He has been living in Montecito since his Hope Ranch home was put up for sale by the court. A proof of claim is a form telling the bankruptcy court how much the debtor owed a creditor when Mr. Slatkin filed for bankruptcy protection in May. Those claim forms will help the court-appointed trustee who is handling and selling the assets of Mr. Slatkin's estate to make a more accurate assessment of the amount of money involved. Although exactly how much is missing is still unknown, Mr. Slatkin owes perhaps 850 creditors an amount estimated to be between $250 million and $539 million. The claim forms will enable the trustee's team to learn more precisely how much money each creditor invested and how much money they received in return from Mr. Slatkin. People who invested years ago may have realized profits while investors who joined later may have lost large sums, according to attorneys in the case. Additionally, this more complete accounting will advance the trustee's efforts to make interim distribution payments to certain investors who need money, such as a quadriplegic who is struggling to pay for nursing care. "Making early distributions to charity cases" is a priority, said Richard Wynne, the attorney who heads a committee of people who each lost millions of dollars. Committee members agree there is a moral imperative to first help those who are suffering the most. Mr. Slatkin is the subject of a federal investigation for allegedly defrauding investors through his unregistered investment advisory business. He promised investors annual returns of up to 60 percent, but creditors' lawyers suspect it was a Ponzi scheme in which early investors were paid with money belonging to more recent participants. Trustee R. Todd Neilson is moving to sell many of Mr. Slatkin's assets and use proceeds to help reimburse creditors. The trustee has collected approximately $3 million to $4 million in cash, Mr. Wynne said, and another $15 million or so worth of stock. He also is selling Mr. Slatkin's local properties, which are worth an estimated $8 million. Mr. Slatkin's membership at La Cumbre County Club already has been sold for $140,000, and some offers have been made on his properties. A judge gave approval Wednesday to the trustee's team to sell Mr. Slatkin's wine collection and three cars: a Volvo coupe, a Corvette and a Pontiac Firebird.