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PFG Best (at making trader money disappear?)

Discussion in 'Forex Articles' started by AsstModerator, Jul 10, 2012.

  1. AsstModerator

    AsstModerator FPA Forums and Reviews Admin

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    PFG Best
    (at making trader money disappear?)

    It looks like something has gone very wrong at Peregrine Financial Group, also known as PFG Best. PFG and Peregrine Asset Management have been locked down by the NFA. They are prohibited from accepting new money, except to cover margin for existing traders. They are prohibited from placing any trades other than to close existing positions. They are prohibited from distributing money to anyone, including existing customers, without the approval of the NFA.

    There are reports that the CEO, Russell R. Wasendorf, Sr., has attempted suicide.

    As I'm writing this, the CFTC just published an order freezing assets. They say that PFG claimed to have over $220 million in client funds, but really only have about $5.1 million in the bank.

    This is a developing story. I'll post some links below. Please add new ones as you find them.

    I'd like to thank FPA reviewer Karon Lewis and FPA Forums Member Dave Hanson for bringing this issue to the attention of the FPA.

    CFTC Files Complaint Against Peregrine Financial Group, Inc. and Russell R. Wasendorf, Sr. Alleging Fraud, Misappropriation of Customer Funds, Violation of Customer Fund Segregation Laws, and Making False Statements

    Initial NFA Case against PFG

    Peregrine Financial Group brokerage said to be $220 million short in customer funds – CBS News

    PFG's accounts frozen after founder attempts suicide - BBC News

    CFTC Can't Handle Peregrine `Mess,' Brandt Says - Washington Post (video)
     
    #1 AsstModerator, Jul 10, 2012
    Lasted edited by : Jan 13, 2016
  2. Triantus Shango

    Triantus Shango Sergeant Major

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    couldn't sleep... so started surfing the web and found this interview re. the current LIBOR scandal: listen carefully to the implications (one of the guys interviewed is a lawyer for one of the largest law firm in the world and used to represent banks--listen to what he has to say re. the banking system):

    here's the video:

    and here is the Blackrock story they refer to in the interview: Suspicion of Forex Gouging Spreads - WSJ.com

    REFCO (former parent company of FXCM) went bust dues to fraudulent accounting years ago. MF Global wasn't safe. Blackrock got screwed by supposedly 'reputable' banks. PFG (a FCM offering brokerage and FX services to retail clients) is another horror story unfolding. FXCM, now a well-known story, got fined multiple times for screwing its clients (and probably still not caught for all the rest they used to do: i'm sure some of you remember the weird price spikes that would take out the stops but which never existed in the real market). and the countless other scams listed on this website.

    all this reminds me that the financial markets are just like the wild west but 10x worse.

    if the corruption is spread that far and wide, makes you wonder who is left that is somewhat trustable to do business with.

    i know, probably not news to most readers of this forum. just thought to mention it due to LIBOR being in the news and as a wake-up call for those newbies who might not have considered the issue yet.

    be very afraid, is all i'm saying.

    (i swear, i am so sick and tired of fraudsters that at this point, should i get screwed, i will not turn to the FPA, police or the CFTC. no. what is needed are more persuasive measures, like putting a contract out on any of those guys if their outfits screw us. that'd truly put the fear of god into those dirtbags. that's what it has come to. back to the middle-ages when egregious attacks on one's wealth were answered by sword and axe. the world is not evolving--it is devolving.)
     
    #2 Triantus Shango, Jul 10, 2012
    Lasted edited by : Jan 15, 2016
  3. Laurie Gold

    Laurie Gold Corporal

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    Down right scary. you can never have a large account with one broker and always need (assuming you are making pips) to pull money out
     
  4. Boko Maru

    Boko Maru Sergeant

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  5. shoebox

    shoebox Private

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    Hi Triantus Shango,
    Would it be possible for you to post this video on some other server as it's being blocked by YouTube here in the UK.

    I agree with your solution; the prospect of broken kneecaps tends to concentrate the mind wonderfully!

    Many thanks,


    Mike
     
    #5 shoebox, Jul 10, 2012
    Lasted edited by : Jan 15, 2016
  6. woody70

    woody70 Recruit

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    That's why I withdraw profits out every 2 weeks if I don't make profit then nothing comes out.
     
  7. winegums

    winegums Private

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    its weird that fxcm advertises here ??
    is there a broker in the uk thats ok ?
    is there a broker in the world thats ok ??
     
    #7 winegums, Jul 10, 2012
    Last edited: Jul 10, 2012
  8. ForexTraderProfit

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    I certainly empathize with traders who may wind up losing money in this case. However, in my opinion, this calls for a change in the legal oversight of brokerages. All data reporting of segregated account funds needs to be sourced by the oversight agency DIRECTLY from the banking institution holding the funds.

    No longer should any broker be allowed to self-report data concerning segregated account balances. This will allow for any mismanagement to be detected immediately and the parties who are directly responsible for deposits-tranfers-withdrawals concerning such accounts are immediately and directly held responsible for what happens.

    There needs to be a "warning" threshold alert immediately sent to regulators - if not as well to brokerage account holders - to make them aware when a certain percentage of client funds are no longer in said segregated accounts - and well before tens or hundreds of millions of dollars go missing.
     
  9. ForexTraderProfit

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    FXCM apparently had problems years ago, but that is not the case now. They are actually one of the best brokers out there.

    I would caution against going into an irrational, paranoid panic about brokers in general just because of this incident.

    There are good brokers. Oanda, Alpari, Dukascopy, as well as several well-known, large multinantional Banks such as Citibank and ING also offer trading services.

    Yes, this was a bad thing, but let's not go overboard and lose our heads. Forex is still, and will continue to be, a great opportunity to build wealth if you take the time to learn to do it right.
     
    #9 ForexTraderProfit, Jul 10, 2012
    Last edited: Jul 10, 2012
  10. mrgummo

    mrgummo Corporal

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    You know, in the USA, when banks deregulation happened in the 1980's, it set the stage for many of the scenarios which are now playing out. We need to have a massive overhaul of the system, coming up with some "common sense" checks and balances from independent sources.

    (And there I was, thinking the mistake I made was using a foreign broker...).
     

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