Tuesday, July 10, 2012

Russell Wasendorf attempted suicide

Brokerage founder attempts suicide — millions in client funds missing, Brokerage PFGBest's founder Russell Wasendorf Sr. is reportedly in critical condition after attempting suicide following news that his company was missing millions of dollars in funds belonging to customers . The National Futures Association had recently taken the drastic action of freezing PFGBest's customer accounts, and employees at the brokerage were quoted saying "we're doomed" while packing up their belongings.

Regulators say $220 million in brokerage customer funds missing, founder attempts suicide, More than $200 million in customer funds appear to have disappeared from the accounts of an Iowa-based futures broker, regulators announced Monday, just hours after the company's founder reportedly attempted suicide.

The National Futures Association ordered all accounts frozen at Peregrine Financial Group (PFG), saying it had received information PFG only has about $5 million of $225 million it has claimed to have in a US-based deposit account. They say it appears the company may have also falsified bank records.
The association, an industry group that serves in a self-regulatory role, also said PFG could not demonstrate that it meets capital requirements and rules requiring it to segregate customer funds.
In a notice to customers, PFG said it was in liquidation-only status as "some accounting irregularities are being investigated regarding company accounts."
"What this means is no customers are able to trade except to liquidate positions. Until further notice, PFG is not authorized to release any funds," the note said according to Reuters.
The announcement from the agency comes just hours after the company's founder Russell Wasendorf Sr. was found in his car outside the company headquarters in Cedar Rapids after apparently attempting suicide.
The 40-year veteran of futures markets was rushed to a nearby hospital and remains in critical condition. His son, Russell Wasendorf Jr, reportedly told staffers at a meeting his father left a suicide note blaming financial troubles.
The company confirmed Wasendorf Sr.'s suicide attempt in a message to its clients.
It was unclear late Monday if the government would get involved. Pete Deegan, spokesman for the U.S. Attorney for the Northern District of Iowa, said he could neither confirm nor deny any investigations handled by the office.
But the move is likely to increase scrutiny on an industry still smarting from the implosion of futures firm MF Global last October.
MF Global, a brokerage headed by former New Jersey Gov. Jon Corzine, filed for bankruptcy protection, crippled by disastrous bets on European debt, less than two years after Corzine became CEO.
A bankruptcy trustee is still trying to recover $1.6 billion in money missing from MF Global's client accounts. That case prompted calls for increased regulation of the futures industry.
A message left at a phone listing in Cedar Falls for Wasendorf wasn't returned Monday. The local sheriff's office said it had no information on the suicide attempt, and the local hospital said it didn't have a patient listed under his name.

Russell Wasendorf attempted suicide Rating: 4.5 Diposkan Oleh: Arm Aritn

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