The Securities and Exchange Commission on Thursday said it charged two Ohio-based investment advisors with overstating the value of an investment portfolio so they could charge more investment advisory fees.

According to SEC allegations, Robert Pinkas and Tab Keplinger--along with Brantley Capital Management (BCM)--inflated the value of equity and debt investments in two failing private companies that comprised more than half of the investment portfolio of Brantley Capital Corp., a New York-based investment company.

An attorney for Pinkas denied the allegations. "Mr. Pinkas has been unfairly targeted by the SEC, and is now preparing to wage what he has every confidence will be a winning defense. The SEC's lawsuit remarkably resembles settled claims of a highly litigious and vocal investor whose attempts to pressure the SEC to take this action are a matter of public record. Mr. Pinkas and his attorneys have strong answers to every one of the allegations in the lawsuit and look forward to proving his case before a fair and unbiased judge or jury in Cleveland," said Pinkas' attorney, Henry W. Asbill of Dewey & LeBoeuf LLP, in a prepared statement.

BCM was the investment advisory firm that managed Brantley Capital's portfolio during the alleged misconduct period from 2002 to 2005. Pinkas was CEO of both entities, and Keplinger was the part-time CFO of both entities.

The SEC alleges that the charged parties hid from BCM's board the financial difficulties of the financially distressed companies in BCM's portfolio and inflated the value of those companies. Asbill said while two of the portfolio's investments went bad, ten others were successful. "Even though one of these unsuccessful investments was written down by BCC, the company is profitable and continues to be one of the leaders in its industry," he said.

From 2002 to 2005, BCM received more than $6.4 million in investment advisory fees from Brantley Capital. Those fees were calculated as a percentage of the latter's net asset value.

While BCM and Pinkas are contesting the SEC's charges, Keplinger has agreed to settle the charges without admitting or denying the allegations. He consented to a judgement that includes a $50,000 fine, as well as a five-year ban from serving as an officer or director of a public company and a one-year ban from associating with an investment advisor.