The Securities and Exchange Commission yesterday closed down a Toledo stockbrokerage firm and disclosed it is investigating a potentially massive fraud involving hundreds of millions of dollars worth of non-existent stock and over-valued shares in a Japanese company.

The SEC declared that Bell & Beckwith, a local Ohio broker, was insolvent and at least $36 million short of being able to meet its debts to customers.

The Securities Investors Protection Corp., which insures stock market investors, asked a federal judge to let it take over the firm, which it said could be the biggest brokerage failure ever handled by SIPC.

A federal judge in Toledo issued an order to shut down the firm on Saturday. The order was sealed until Monday, when a security guard turned away customers at the firm's headquarters.

Bell & Beckwith's attorney, Robert E. Gosline, told the Associated Press in Toledo there was a lack of security in margin accounts handled by Edward Wolfram Jr., managing partner of the firm.

The accounts, listed in the name of Wolfram's wife and amounting to $32 million, were supposedly backed by securities worth $488 million. The collateral included 2,816 shares of Toto, Ltd., a Japanese firm, which were claimed to to have a market value of $278 million. In reality, SEC examiners said the Japanese stock was worth only $5,000.

Bell & Beckwith records also showed securities valued at $105 million in the Las Vegas branch of First Interstate Bank of Nevada. The examiner said the shares do not exist.

At a court hearing Saturday, SEC compliance officer Ralph Buie testified that Bell & Beckwith was insolvent and had debts to customers amounting to at least $21,134,000 more than its assets.

SEC officials in Washington said the firm had total unsecured indebtedness of $41 million and assets of about $5 million for a total shortage of $36 million.

In an unusual Saturday session, U.S. District Judge Nicholas Walinski in Toledo issued a temporary restraining order forbidding the company from doing business. The company was also suspended from membership in the New York Stock Exchange.

Bell & Beckwith, which had been in the securities business since 1950, had 7,400 customers. According to SIPC, 67 of those accounts were more than $100,000.

SIPC insures investors securities accounts against bankruptcy up to $500,000. If a brokerage firm fails, customers can receive up to $100,000 in cash for any cash in his account to be used for purchasing securities; the rest is returned in like securities.

William D. Goldsberry, administrator of the SEC's Chicago regional office, said he did not know how long the firm had been insolvent. He said authorities acted five or six days after the shortage was discovered.

Steven Harbeck, a spokesman for SIPC, said there have been 161 liquidations of failed securities firms since 1971 when SIPC was created. Last year there were eight brokerage failures.

The largest brokerage firm to fail before Bell & Beckwith was Stix & Co. of St. Louis, which closed its doors in November 1981, with liabilities of $26 million. John Muir & Co. of New York, cost SIPC $15 million in customer claims.