Where The “Segregated” PFG Money Is
Or rather isn’t. Just in case there is any confusion this morning as to where the “segregated” client cash may have vaporized to…
From: “Herb Kral” <[email protected]>
Date: Tue, 22 Nov 2011 10:07:55 -0600
Subject: RE: Follow up
All of our client funds are held at JP Morgan Chase in a segregated account. Jeffries does hold our margin money for positions.
Herb Kral, Director of Automated Trading
311 W. Monroe, Suite 1300
Chicago, IL 60606
312-775-3581 | 312-775-3095 fax
PFG Is Now MFG(lobal) Part 2 As $220 Million In Segregated Client Money Has Just Vaporized
UPDATE 2: Have no fear though since as recently as January 2012, the CFTC did not find any “material breaches of customer funds protection requirements” at FCMs (firms like PFGBest)
UPDATE 1: Account-holders may not be so surprised to find who is the custodian for the PFGBest FX accounts: none other than huge MFGlobal fans, JPMorgan!
Remember when the entire segregated account fiasco was supposedly fixed in the aftermath of the November 2011 MF Global bankruptcy, and where regulators: the CFTC, the SEC, the CME, and anyone you asked, swore up and down this would never happen again? Turns out that 7 months later, the spirit of MFG has struck again, only this time with one letter switched: it is now known as PFG, as we suggested first 3 hours ago when we broke the story. From the just filed affidavit by Lauren Brinati who is working with the National Futures Association, which in turn has just filed notice prohibiting PFGBest from operating further, and freezing all of its accounts:
- On or about June 29, 2012 PFG reported to NFA that it had approximately $400 million in segregated funds, of which more than $225 million were purportedly on deposit at U.S. Bank
- On or about July 9, 2012, NFA received information indicating that PFG’s Chairman may have falsified bank records
- On July 9, 2012, NFA made inquiry with US Bank and learned thatrather than the $225 million that PFG had reported as being on deposit at US Bank just days earlier, PFG had only approximately $5 million on deposit at U.S. Bank.
Translation: another $220 million segregated account pillage has just taken place, in the vein of none other than Jon Corzine and MF Global.
The money has now officially vaporized.
It is truly wonderful of the NFA to finally get involved, after PFG’s clients have lost about 98% of their cash held with the firm.
In other potential news, a rather prominent New York bank, recently closely associated with marine wildlife, may have just cut its Q2 losses by up to $220 million.
And now for a moment of sarcasm, courtesy of Jack Pearson.
Full NFA filing:
p Fg Best Notice
Well, at least one person got to tell Jamie Dimon exactly what the majority of people in the United States think of him and his cronies.