Regulators Charge Futures Brokerage Firm With Fraud.
Source: nyt
The Commodity Futures Trading Commission on Tuesday charged a futures firm and its chief executive with fraud and making false statements after nearly $200 million in customer funds went missing.
The regulator is seeking a restraining order against the Peregrine Financial Group, also called P.F.G., to prevent the destruction of any information that may be needed in the course of the investigation. The C.F.T.C. is also asking a federal court to appoint a receiver for the firm and freeze its assets. A day earlier, the chairman and chief executive, Russell Wasendorf Sr., tried to commit suicide outside of the firm’s offices in Cedar Falls, Iowa.
The Federal Bureau of Investigation is investigating the matter, according to a spokeswoman for the Omaha office, Sandy Breault. Ms Breault indicated that the Chicago office of the agency may also get involved.
News of the missing money surfaced Monday, when the firm’s primary regulator, the National Futures Association, determined that an account that was supposed to have $225 million of customer money actually held just $5 million. A further review of records showed that the firm had been falsifying its records as far back as 2010, the regulator said in its complaint. In February 2010, an account that purported to have some $218 million in reality contained just $10 million.
Read more: http://dealbook.nytimes.com/2012/07/10/regulators-charge-futures-brokerage-with-fraud/?hp
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