The former Arcade building in Riverside is under the control of the Dewey and LeBoeuf law firm because of a federal ruling involving the building owner, WexTrust Capital, which has been accused of securities fraud.

The U.S. Securities and Exchange Commission sued WexTrust Capital Aug. 11 alleging the company conducted a Ponzi-type scheme from 2005 or earlier that raised about $225 million from about 1,200 investors, according to the commission.

According to the commission, the defendants, Steven Byers, 46, of Oak Brook and Joseph Shereshevsky, 51, of Virginia, told investors proceeds or donations would be used for specific projects but the defendants allegedly diverted funds to pay returns to investors in prior offerings or to fund expenses of the defendants.

Riverside Village Manager Kathleen Rush said as a result of the action by the commission, the courts have frozen all assets of WexTrust Capital, which includes the Arcade building. The receiver of WexTrust Capital is Dewey and LeBoeuf law firm, which was chosen by the courts.

“They are like a court-appointed guardian,” Rush said. “Essentially their goal is to protect their (WexTrust’s) assets.”

Rush said the Arcade building in downtown Riverside is a commercial building with retail on the first floor and potential office space above. The village was working with WexTrust on building improvements, which were slower than the village would have liked, but some progress was being made to attract a commercial tenant, Rush said. WexTrust was working to install new windows and a new sprinkler system and had already installed new bathrooms and electric wiring, which totaled around $500,000.

With lawsuit rulings, development is going to make things more complicated, but Rush said the project the village wants will be completed. Currently, no timetable has been established for the completion.

The goal now is to protect the building’s value and determine when the improvements will take place. However, Rush said because of the federal lawsuit, the process is going to be slowed down.

The contact information on WexTrust’s Web site has been removed and forwards visitors to the law firm. Associates at Dewey and LeBoeuf did not return phone calls for comment. Andrew Calamari, a SEC case worker, said the next court date is scheduled for Thursday, Sept. 4.