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US broker PFGBest freezes funds after founder's suicide attempt

  • #101
  • Jul 12, 2012 7:39am Jul 12, 2012 7:39am
Like we really need any more proof as to how stupid and inept the NFA and CFTC are at regulating anything... this news is just un-believable IMHO.


Quoting Reuters
Exclusive: U.S. probing failed broker PFGBest's use of small auditor

http://l1.yimg.com/bt/api/res/1.2/FZ...b5cec5193.jpegBy Sarah N. Lynch and Nick Carey | Reuters – 7 hrs ago

 

  1. http://l.yimg.com/bt/api/res/1.2/8D....ST-AUDITOR.JPGJeannie Veraja-Snelling, sole proprietor …

  1. WASHINGTON/CHICAGO (Reuters) - U.S. futures industry investigators are looking into why Iowa-based collapsed brokerage PFGBest used a tiny accounting firm that appears to be operating from inside a suburban Chicago home to audit its books, according to a person familiar with the matter.


Experts said the use of such an auditor should have been a red flag to regulators of a futures brokerage with more than $500 million in assets and several hundred employees across the United States as well as in Shanghai and Canada.

There are comparisons with the way convicted Ponzi schemer Bernard Madoff used an auditor operating out of a strip mall in suburban New York and convicted swindler Allen Stanford's investment firm retained a little-known auditor on the Caribbean island of Antigua.

PFGBest's financial statement ended December 31, 2010, shows that a firm called Veraja-Snelling Company, based in Glendale Heights, Illinois, certified that the futures broker was in compliance with federal commodities regulations governing the segregation of customer money.
On Tuesday, the U.S. Commodity Futures Trading Commission accused the now-bankrupt brokerage and its founder Russell Wasendorf Sr. of misappropriating roughly $200 million of customer money in a fraud it said dates back to at least February 2010, and then lying to cover it up.
The alleged fraud came to light after Wasendorf's apparent suicide attempt on Monday morning outside the firm's Cedar Falls, Iowa, offices.
The CFTC is looking into the role of the auditor as it continues to investigate PFGBest, said the person familiar with the matter, who was not authorized to speak publicly.

When reached at her Glendale Heights home on Tuesday night, Jeannie Veraja-Snelling, who listed herself an officer of the firm when she registered with the Public Company Accounting Oversight Board in February 2010, said she could not talk about PFGBest.

"I don't know what's going on. I just found about it all an hour ago so I can't talk about it," said Veraja-Snelling, appearing distraught.
A PFGBest spokeswoman did not return a call seeking comment.

Another source told Reuters on Tuesday that Wasendorf went to great lengths to fabricate PFGBest's financials, saying he intercepted confidential regulatory documents that were mailed by the National Futures Association to what the industry self-regulatory group believed was U.S. Bank, the bank used by PFGBest.

Instead, the NFA was sending the documents, used to independently verify a broker's bank balances, to a post office box that Wasendorf had set up, the source said.

In the 2010 report, Veraja-Snelling & Co wrote that there were no material weaknesses involving internal controls and that the "corporation's practices and procedures were adequate." The NFA confirmed that the accounting firm, which has no disciplinary history with Illinois financial regulators and has not been accused of any wrongdoing, also audited PFGBest's 2011 financial statements. It was not clear if it was still PFGBest's auditor at the time of its bankruptcy filing on Tuesday. An NFA representative declined to comment further. A CFTC spokesman did not have an immediate comment.

HOME BUSINESS

Veraja-Snelling & Co is located on a busy, four-lane street inside a modest house, that is a faded-pink color, in Glendale Heights, some 30 minutes outside of Chicago. Jeannie Veraja-Snelling has been certified in the state of Illinois since 1999. However, she does not list having any public company clients in her 2011 annual filing with the PCAOB.

On Tuesday night, she came to the door wearing a green sleeveless shirt and blue denim shorts. A stack of cardboard filing boxes was sitting just inside the door. She declined to answer questions about how she came to be retained by PFGBest. She did not respond to a follow-up e-mail and voice mails asking questions. Little information appears to be publicly available about Veraja-Snelling. According to online records submitted to the U.S. Securities and Exchange Commission, the firm audited some broker-dealers, including Best Direct Securities, LLC, which is owned by PFGBest, for the year ending December 31, 2009.

The online records also indicate Veraja-Snelling has audited other small-sized securities brokers, such as Chicago-based Arclight Securities LLC for its 2007 financial statement, and Corporate Investments Group over several years, including 2011. Audit experts say that just because PFGBest hired a small auditor to do its books does not necessarily say anything about the auditor's competence. Instead, they said, it speaks more to the management of PFGBest and why the firm did not pick a larger auditor with a more established reputation. "Typically if you are in a business like this, you want to have people have confidence in your numbers and feel like you have got a big name behind them," said Lynn Turner, a former chief accountant for the SEC.

The failure of regulators at the NFA to notice some of the red flags, they added, is also troubling. "You would think that a regulator would notice this and that should trigger much higher scrutiny," said Tom Selling, who writes an accounting blog called the Accounting Onion. "There's no question that the regulator's protocol should take that into account, especially a sole practitioner."

INVESTIGATION CONTINUES

Experts say it is not common for the CFTC to bring actions against auditors, but it is not unprecedented. In September of last year, the CFTC charged the national accounting firm McGladrey & Pullen and its partner David Shane with issuing an unqualified audit opinion on futures brokerage One World Capital Group.

At the time the case was filed, David Meister, the head of CFTC enforcement, stated that "the commission will not hesitate to impose significant sanctions on auditing firms and hold individuals personally responsible when they fail to adhere to their professional obligations."
The company and the audit partner settled the CFTC's case without admitting or denying the charges. The firm agreed to pay $900,000, and Shane paid $100,000.

Another potential regulatory body that could look into the situation is the PCAOB, which gained new authority under the 2010 Dodd-Frank Wall Street reform law to inspect auditors of broker-dealers. A PCAOB spokeswoman declined to say if Veraja-Snelling had been inspected under the new program, or whether the PCAOB will investigate the firm in light of the alleged fraud at PFGBest. Joseph Carcello, a professor at the University of Tennessee, said the PCAOB has limited resources but may look into PFGBest's audits because of the publicity around the case.
"It has some echoes of Madoff ... I'd be shocked if they don't think about it," he said.

(Reporting By Sarah N. Lynch, Emily Stephenson and Nick Carey; Editing by Karey Wutkowski, Martin Howell and Chris Gallagher)

STORY LINK

  • #102
  • Jul 12, 2012 8:21am Jul 12, 2012 8:21am
thank you Pip Seeker for keeping us who lost informed. It helps a little. What really gets me they still have their web site running
  • #103
  • Edited 5:19pm Jul 12, 2012 4:44pm | Edited 5:19pm
Another issue with the new rules by the NFA is the reduced leverage rule. Now we have to keep more of our capital at the brokerage to cover the margin. Just another rule made by regulators who have never traded and dont understand things like this.

I never put all my trading capital in a brokerage. I would just use the leverage to trade like all the capital was in their. This saved me before when Refco went under. Now their forcing us to put more of our trading capital at risk.

Also am I the only one who is seeing the conflict of interest having the C.E.O and Principals of these brokerages sit on the advisory board of the NFA?
  • #104
  • Jul 12, 2012 10:45pm Jul 12, 2012 10:45pm
Quoting Reuters
CFTC calls emergency meeting after PFGBest scandal

By Alexandra Alper and Sarah N. Lynch

WASHINGTON | Thu Jul 12, 2012 6:37pm EDT

WASHINGTON (Reuters) - The Commodity Futures Trading Commission has called an emergency industry meeting to explore how to better protect customer money, days after the discovery that millions of dollars of customer funds went missing at now-bankrupt futures broker PFGBest.

Scott O'Malia, a commissioner at the U.S. futures regulator, invited the agency's Technology Advisory Committee to meet on July 26 in Washington. The group, which is made up of futures industry representatives, will discuss ways that banks can provide quick automated verification to customers that their funds are safe, after the discovery earlier this week of a roughly $200 million shortfall in customer funds at Iowa-based PFGBest.

"This fraud and the fraud perpetrated at MF Global that came to light less than year ago both involve the theft of customer funds by intermediaries," O'Malia wrote in an email to committee members on Thursday. "What we need is a technology solution that eliminates the possibility of theft and misappropriation of customer funds." Peregrine Financial Group, PFGBest's regulated unit, filed for bankruptcy on Tuesday in Chicago after regulators accused it of misappropriating customer funds for more than two years.

The CFTC, which along with industry regulators had given a clean bill of health to dozens of brokers following spot checks in January, alleged that Peregrine and its owner, Russell Wasendorf Sr, had defrauded customers and lied to regulators in order to hide the shortfall.

The bankruptcy has sent shockwaves through a futures industry still jittery less than nine months after MF Global collapsed. Investors and customers of that futures brokerage became rattled over its multi-billion dollar bet on European sovereign debt and the firm's subsequent downgrades by credit rating agencies, resulting in a liquidity crunch.

An estimated $1.6 billion in customer funds went missing during the firm's chaotic final days.

ELECTRONIC OVERSIGHT

The committee's technology focus goes to the heart of the alleged PFG fraud, which relied on paper submissions of bank balances, according to a source familiar with the matter who declined to be identified. Wasendorf intercepted confidential regulatory documents that were mailed by the National Futures Association to what the industry group believed was U.S. Bank, PFG's bank, a person close to the situation told Reuters. Instead, they were sending the documents, used to independently verify a broker's bank balances, to a post office box that Wasendorf had set up, the source said.

Wasendorf forged signatures and fabricated bank balances on the documents and simply mailed them back to the Chicago-based NFA, the person said. The scheme apparently began to unravel as the NFA shifted to electronic confirmations.

The NFA "started getting suspicious. He was resisting this new way of confirming the balance," the source said. Wasendorf only recently signed the authorization, a decision that would quickly have led regulators to uncover the discrepancy.
On Monday Wasendorf was rushed to the hospital after a suicide attempt.

"In an age where we can check our bank accounts and credit card balances on a mobile phone, there is no reason why FCM customers cannot have similar confidence that their investments are secure each and every day," O'Malia wrote, using the industry term for a futures commission merchant.

The technology committee, which is chaired by O'Malia, will also explore better ways to give the CFTC and first-line regulators like the NFA direct access to customer account information, without compromising confidentiality.

The committee will also take a close look at current collateral and segregation rules and how well they protect segregated funds. A subcommittee recently proposed a definition of high frequency trading, a key first step in beefing up oversight of the hotly debated algorithm-based trading space.

Citigroup said it is giving its customers Internet access to details about how their collateral is invested, responding to customer concerns following the loss of funds in MF Global. The system, called Citi Velocity, began working over the weekend, before news broke about PFGBest.

(Reporting by Alexandra Alper; Editing by Gary Hill and Phil Berlowitz)

STORY LINK
One has to wonder why something like this wasn't thought of sooner?
  • #105
  • Jul 12, 2012 11:15pm Jul 12, 2012 11:15pm
Quoting Reuters
Iowa senator calls for congressional scrutiny of PFGBest

Thu Jul 12, 2012 3:50pm EDT

* Ag Committee should look into collapse of PFG-Grassley
* Also wants CFTC to explain its regulation of PFG
* Republicans point to regulator failures in recent scandals
By Emily Stephenson

July 12 (Reuters) - A U.S. senator from Iowa wants the Senate Agriculture Committee to look into the scandal surrounding now-bankrupt futures broker PFGBest during a hearing scheduled for next month. The committee already plans to meet on Aug. 1 to discuss the fallout from the failure last fall of a larger futures broker, MF Global.

That hearing's focus should be expanded to consider how regulators oversaw Iowa-based PFGBest, Republican Senator Chuck Grassley said in a letter to Agriculture Committee Chairwoman Debbie Stabenow, a Democrat, and the panel's top Republican Pat Roberts.

PFGBest, which had a state-of-the-art headquarters in Cedar Falls, Iowa, collapsed this week after revelations it was missing more than $200 million in customer funds.

"It's important the Senate Agriculture Committee look into the PFGBest matter in the same manner as what we have done regarding MF Global," Grassley, a member of the agriculture committee, said in the letter. "We have to make sure regulators are doing their job." Grassley has a professional acquaintance with PFGBest's founder Russell Wasendorf Sr., who appears to have tried to commit suicide on Monday morning outside the firm's offices.

Grassley attended the opening of PFGBest's Iowa headquarters in September 2009 and the program portion of a Waterloo, Iowa, triathlon sponsored by Wasendorf's Peregrine Charities, according to a spokeswoman for Grassley.
Grassley has been quick, however, to call for lawmakers to concentrate on regulators' supervision of the firm.

The Commodity Futures Trading Commission has accused the firm's regulated unit, Peregrine Financial Group (PFG), and its owner of misappropriating customer funds for more than two years.

Some experts have compared the broker's actions to a Bernard Madoff-style Ponzi scheme. A source has told Reuters that Wasendorf used a post office box to intercept and fabricate documents meant to be filed by PFGBest's bank with the National Futures Association.

Investigators now are looking into questions such as why PFGBest used a tiny accounting firm that appeared to operate out of a Chicago-area home to audit its books. Grassley also asked the CFTC for information on how the agency responded to signs of trouble at PFGBest, such as accounting irregularities, going back as far as February 2010.

"With the failure of MF Global and now PFG, the CFTC must be open and transparent with Congress and the American people to prevent the continued erosion of customer confidence in the integrity of the commodities markets," Grassley said in a letter to CFTC Chairman Gary Gensler. Some Republican lawmakers have blasted regulators for failing to prevent recent scandals, including PFGBest and allegations that major banks sought to manipulate an inter-bank lending index that is the benchmark for many consumer interest rates.

Senator Jerry Moran, a Republican from Kansas, on Thursday called for Gensler to resign, saying the collapse of MF Global and PFG shows that the CFTC under his watch failed to protect consumers.

The missing funds represent more than half of PFGBest's client accounts. That pales in comparison to the $1.6 billion estimated to be missing from accounts at MF Global.

Lawmakers questioned former MF Global head Jon Corzine but have left new rules to prevent similar blow-ups to regulators. The CFTC has been considering new rules to hold futures executives accountable for customer funds.

STORY LINK


He should be thrown in jail, stop protecting the rats and this nonsense will end. Hold each and every one of them responsible. When you got people that hold seats on advisory boards and what not, they all share responsibility.... just as much as if someone was present in the commission of a crime and did nothing to stop it.
  • #106
  • Jul 13, 2012 2:12am Jul 13, 2012 2:12am
Quoting PoundTrader
PFG BEST didn't fail there customers, the regulators fail to protect customers. this is not a broker problem it a regulator problem that needs to be fix
How can you say it is a regulator problem when the top management of the broker decided to lie? You had me until this point (if I believe that you pulled your funds from PFG in the last weeks). But this is ridiculous. If a CEO or CFO wants to steal money...they can steal money. It isn't a reflection on the industry. It is a reflection on those people, and maybe it points to the fact that we shouldn't be looking at pure FX brokers, who have never operated under real regulations.
  • #107
  • Jul 13, 2012 2:13am Jul 13, 2012 2:13am
Quoting pber57
I am hearing that there was a corporate jet, 24 million dollar building, trip to Northern Italy for the restaurant staff and a bookeeper that was the CFO. Here is the link to a news report that takes a half hour dedicated to the PFG scam.


http://youtu.be/4Y7GjKu5xaE?t=1s
That sounds more like the problem than the NFA. This is corporate corruption at its best.
  • #108
  • Jul 13, 2012 2:15am Jul 13, 2012 2:15am
Quoting Bohsen
I lost my primary trading account with PFG this week and my trading career is currently over. If anyone can offer a glimmer of hope, I'd love to hear it.

FYI - PLEASE make sure your clearing firm is as high up on this list as possible:

http://www.zerohedge.com/news/first-...w-pfg-who-next
Sorry to hear. Not sure your list is the answer. MF Global would have been high on the list. I think the better answer is to get away from these FX only brokers and find someone that has been around awhile with a legit interest in fixing the industry. I'm talking about Hotspot, MBT, Tradestation, etc.
  • #109
  • Jul 13, 2012 2:16am Jul 13, 2012 2:16am
Quoting slow_trader
don't put all good brokers with pfgbest....we all know pfgbest is a small broker.......go with citifx...they are a huge bank with huge liquidity so they are relatively safer......when brokers claim they offest your risk in trading and only earn from spreads, they are bullshitting u......all brokers are your counter-party and they trade against you.....all depends on how deep the broker's pocket is to lose to a profitable trader
MF Global was huge. Refco was the hugest (back in the day). Huge doesn't solve corruption.
  • #110
  • Jul 13, 2012 2:18am Jul 13, 2012 2:18am
Quoting pber57
Good point. Just remember though if the FEDS had not backstopped Citi accounts would have been lost there too.
Citi? Give me a break. The question is, where did the money go? Losses against trading against customers? Management took it (blending of funds)? This point doesn't matter if the money is GONE, but it should still become public.
  • #111
  • Jul 13, 2012 2:21am Jul 13, 2012 2:21am
Quoting DesertSky
Another issue with the new rules by the NFA is the reduced leverage rule. Now we have to keep more of our capital at the brokerage to cover the margin. Just another rule made by regulators who have never traded and dont understand things like this.

I never put all my trading capital in a brokerage. I would just use the leverage to trade like all the capital was in their. This saved me before when Refco went under. Now their forcing us to put more of our trading capital at risk.

Also am I the only one who is seeing the conflict of interest...
NFA is a scam. We should look to an FX brokerage with a history that has capitalization but decides to get rid of NFA. You want the board of FXCM deciding your broker's fate? Get rid of the NFA. Let's get a real regulator.
  • #112
  • Jul 13, 2012 2:28am Jul 13, 2012 2:28am
Quoting brenn82fx
The funny thing is that it seems like so many traders are looking to get away from regulation, as if they don't get that it is there to protect them. They'd rather have a shot at blowing themselves up to 400:1 leverage overnight than care about the broker stealing their money. I'm definitely looking for US based brokers with a strong history of being regulated. I'm also prioritizing brokers that were in other markets before Forex where they were regulated by other entities.
The irony of your criteria for a safe, secure US-based broker is that PFG fit that very profile.
- 2 decades in the business
- started out with futures
- won numerous industry awards (i remember considering them for forex about 2 years ago or so, never funded the account)
- CFTC/NFA regulation, with 'up to date' healthy status report.

Unless you were an insider, who could have detected based on popularity that PFG was not a good broker to trade with (futures or forex)?
While you can certainly check references, ultimately nothing but your own common sense will guide you towards choosing a broker. If your intuition doesn't flag anything, do some research and take some risks. But it is rare that a company just goes under in a flash without some kind of intuitive "triggers".

History has shown that popular opinion alone is insufficient in making choices that don't go against yourself. Remember the titanic? I wasn't old enough but my dad would always talk about how some of the world's most brilliant minds backed that ship. 'It's unsinkable'. Bernie Madoff duped some very intelligent and popular people.

Quoting PoundTrader
did you guys notice it's always future and forex brokers that get in trouble, big stock brokers like etrade and other stock broker dont go thru stuff like this
Are you kidding me? Does Enron ring a bell? What about Bernie Madoff? Often times with fraud in the stock market, the attention goes to the company or individuals that goes bankrupt or originates the scam. Very little attention is brought to the stock broker who helps facilitate the scam arrangement.

At least futures has clearing firms to guarantee payment from the other side of the trade. What happens when a company goes bankrupt?
Quoting DesertSky
Im not sure. But I did listen to the CFTC commissioner interview on Fox business network and to use his words "Pfg clients are screwed." That can't be good for PFG clients coming from him.
+1.
Measure trends automatically with zero lag
  • #113
  • Jul 13, 2012 2:50am Jul 13, 2012 2:50am
Quoting brenn82fx
How can you say it is a regulator problem when the top management of the broker decided to lie? You had me until this point (if I believe that you pulled your funds from PFG in the last weeks). But this is ridiculous. If a CEO or CFO wants to steal money...they can steal money. It isn't a reflection on the industry. It is a reflection on those people, and maybe it points to the fact that we shouldn't be looking at pure FX brokers, who have never operated under real regulations.
simple question, there always gonna be bank robbers, the question is would you rather catch a bank robber inside robbing the bank where you know you get 100% of your money back, or would you rather catch a bank robber months or years later where you be lucky to get any money back ?
  • #114
  • Jul 13, 2012 3:21am Jul 13, 2012 3:21am
Quoting ybfjax
The irony of your criteria for a safe, secure US-based broker is that PFG fit that very profile.
- 2 decades in the business
- started out with futures
- won numerous industry awards (i remember considering them for forex about 2 years ago or so, never funded the account)
- CFTC/NFA regulation, with 'up to date' healthy status report.
Yea, there were signs that refco is in trouble 1 week before it went bankrupt, there were bad news for mfglobal about money missing in segregate accounts 1 or 2 days before they went bankrupt, but there were signs even before that - they reported quarterly loss october 25 (they went bankrupt october 31), but on pfg news came out the same day accounts were frozen, there were no signs and no time to act, that's scary, all i can say about them they excess net capital is not very big.
  • #115
  • Jul 13, 2012 3:47am Jul 13, 2012 3:47am
I am speachless... :/ Does any owner of trading account with PFG get some portion of their money back?
  • #116
  • Jul 13, 2012 5:00am Jul 13, 2012 5:00am
Seeking alpha artice...

Forex brokers have been going under nearly on a monthly basis, as any forex trader or client can attest for the last few years. The most recent, PFGBest, was also a futures commissions merchant with over 70,000 clients and a reported $500 million in customer funds.

The Differences Between PFG and MF Global

It is rumored that many MF Global customers will receive anywhere from 90%-98% of their funds from the current custodian. While this figure may vary depending on individual circumstances, we have not heard that customers may lose more than 15% of their deposit max. While this is an unfortunate situation, and also considering funds will be locked up while the procedure continues, it is not a 100% loss.

It is still too early to tell how PFG will play out, but based on available information, PFG only had $5 million on deposit with obligations well over $200 million in missing funds -- not counting possible lawsuits and other obligations they may have had. For a company that size, $5 million will not cover the legal fees. But assuming there are no expenses unraveling PFG, 5/200 = 2.5%, suggesting clients will get a maximum of 2.5% of their invested funds -- a near-complete loss.

The Differences Between Now and Forex 2007

The forex industry is not new to this. It has happened before with Refco, FXLQ, CFG, One World Capital, and countless others. However, there are key differences that make this a lot scarier:

Before 2010, forex was largely unregulated globally. While many firms chose to register with the NFA voluntarily, registration was not explicitly required until the passage of Dodd-Frank. So it was a lot easier for scammers and unregulated clowns to operate.
PFGBest was a medium-sized company, but one of the most respected in Chicago. Russell Wasendorf Sr. was a pioneer in electronic trading who later expanded into publishing, forex, and investment management. It is not yet clear when the fraud began, but certainly not more than five years ago. PFGBest was a highly regulated, well-respected company in the industry.
What Is Scarier

FCMs and FDMs report daily seg funds to NFA. PFG was a medium-sized firm with different divisions (compared to a small business where a single individual may have multiple roles). After the MF Global meltdown, PFG was audited by the regulators. PFG had external auditors both for regulatory and accounting purposes. Wasendorf served on the NFA advisory committee.

What's scarier: that this fraud was perpetrated by a group of insiders, or that executives, accountants, and regulators all missed $200 million?

Also, with all the new regulations and rules, if they can't stop PFG from happening, then what can they stop?

PFG Compliance

Anyone who worked with PFG on a professional level can attest to the fact that it was very uptight about compliance issues. This may have been a ruse, to pretend to be strict on compliance while hiding an elephant in the room. Or it may have been a policy created by a single conspirator to mask the massive loss of $200 million. Either way, PFG compliance took issue with legitimate IBs and CTAs while $200 million in customer funds went missing.

If this can happen to PFG, is it possible it could happen anywhere?

Stock Play: Short the Financial Sector

We do not trade or recommend stocks as we are a forex CTA. Our concerns over institutional risk are that of having a custodian to hold our funds and client funds offering access to forex markets. However, our analysis researches all global markets as they are connected.

Jim Rogers said several years ago he was shorting the financials. In a recent article, "Modern Institutional Decay," we elaborated on the decline of financial institutions in their quality. This was before the situation with PFG. The PFG meltdown opens up many questions about other institutions. The big concern is that on the outside, PFG seemed to be a credible, well-regulated, trustworthy institution. PFG had fines and lawsuits, but many similar institutions have similar types of fines and lawsuits.

If one wanted to bet on others suffering the same fate, one might consider shorting financial stocks. Many institutions are private companies, such as PFG, but many are not. We have witnessed JPMorgan's (JPM) involvement in a number of questionable practices this month.
  • #117
  • Jul 13, 2012 5:38am Jul 13, 2012 5:38am
Quoting brenn82fx
Sorry to hear. Not sure your list is the answer. MF Global would have been high on the list.
MFG was low on the Atlas Ratings (115th out of 126 according to their website). PFG was near the bottom.
  • #118
  • Jul 13, 2012 8:17am Jul 13, 2012 8:17am
Quoting fx111
but on pfg news came out the same day accounts were frozen, there were no signs and no time to act, that's scary, all i can say about them they excess net capital is not very big.

PFGBest had signs for over 2 years at least. (Bank records)

The problem is that the NFA & CFTC didn't do their jobs to find the signs.

This is like the government saying we didn't have any warning for Hurricane Rita.

http://upload.wikimedia.org/wikipedi..._Rita_Peak.jpg
  • #119
  • Jul 13, 2012 9:02am Jul 13, 2012 9:02am
Quoting pip_seeker
PFGBest had signs for over 2 years at least. (Bank records)

The problem is that the NFA & CFTC didn't do their jobs to find the signs.

This is like the government saying we didn't have any warning for Hurricane Rita.
I agree on that, if they did their job properly this wouldn't happen, but i'm talking about signs that we little retailers can eventually see from their balance sheets, bad news, or something which would tell us we should pull out the money couple of days before they froze accounts and file for bankruptcy.
  • #120
  • Jul 13, 2012 10:48am Jul 13, 2012 10:48am
Quoting Canam980
Seeking alpha artice...



If one wanted to bet on others suffering the same fate, one might consider shorting financial stocks. Many institutions are private companies, such as PFG, but many are not. We have witnessed JPMorgan's (JPM) involvement in a number of questionable practices this month.

Short financials and make a fortune.

Than send a withdraw order just to find that your broker is broke and so are you!
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