PFGBest Liquidating Operations
Midsize futures brokerage PFGBest said Monday it is putting a hold on client accounts, liquidating operations andwarning employees that their jobs are at risk in light of what it described as "accounting irregularities" underinvestigation.
PFGBest's woes come as another blow to a derivatives industry on the whole reeling from the collapse of brokerage MF Globallast year, which left thousands of retail and institutional customers nursing financial losses.
Lauren Nelson, director of communications for Attain Capital Management, an introducing broker, drew a contrast withthe MF Global situation, saying that if client accounts were at risk at PFGBest, its clearing broker, Jefferies GroupInc., would have issued a "notice that obligations were not being met." No such notice has been received,according to Ms. Nelson.
Earlier this year, PFGBest was sued in U.S. District Court in Minnesota due to a relationship with Trevor Cook, whowas sentenced to 25 years for operating a Ponzi scheme that stole more than $190 million from investors in his funds.