PFG Trustee expected to pay twice as much for some accounts as others?

Discussion in 'Retail Brokers' started by comintel, Dec 28, 2012.

  1. I received the following unsolicited offer today (at bottom of this post) for my PFG claim. I changed the name of the sender to XXX.

    I am not interested in the offer as such, and will not take it (I am in in no rush), but am interested in the expectations for recovery implied in it.

    The offers are about 38% for U.S. futures accounts and about 75% for accounts set up to trade foreign futures exchanges.

    This is because Wasendorf took the funds from segregated funds set up for trading U.S. futures. There was no deficit in the account set up to trade foreign futures. The Trustee has indicated that he will treat these as separate pools if the judge so approves.

    Wouldn't it be fairer to treat the two equally?

    There seems to be no way to have a dialogue in this area. CCC has no public forum. Neither does the trustee. The people suing on a class action basis do not respond to emails either.

    Discussions here do not get much response either.

    Of course, we can hope that the Trustee finds other funds so that both classes of customers get paid back fully, but this looks a lot less likely for PFG than is turning out to be the case with MF Global.


    Dear Sir or Madam,

    XXX is an active investor in the customer claims of the Peregrine Financial Group (“PFG”) bankruptcy case. We understand that you or your client may have a Commodity Futures Account (“4D”) or Foreign Futures Account (“30.7”) claim against the PFG estate. Depending on the type of claim, you should have received a partial payment from Vision Financial Markets LLC (“Vision”) through a bulk transfer that took place towards the end of October, 2012.

    For your consideration, we are currently bidding the following rates for certain claims against PFG:

    Type of Claim Claim Size Pricing

    Commodity Futures Account - 4D $100K-$500K 37% (less any distributions already received)

    Commodity Futures Account - 4D $500K - $1M 37.5% (less any distributions already received)

    Commodity Futures Account - 4D $1M+ 38% (less any distributions already received)

    Foreign Futures Account - 30.7 $100K-$500K 74% (less any distributions already received)

    Foreign Futures Account - 30.7 $500K - $1M 75% (less any distributions already received)

    Foreign Futures Account - 30.7 $1M+ 76% (less any distributions already received)

    If you have a different type of claim than the 4D or 30.7, we’re not an active buyer right now, but you can be in touch with me and we can work to develop a bid for you.

    Please note, pricing is subject to change higher or lower according to active market conditions and claims are bought on a first offered, first purchased basis. Any potential claim purchase is subject to the review of standard claim support documentation, and XX reserves the right to not purchase any claim presented for sale, for any reason.

    If you are not familiar with XXX, I encourage you to visit our website at to learn more about us and read some of the testimonials from others who have sold their claims through XXX.

    Best Regards for Happy and Healthy New Year.



    you should have received a partial payment from Vision Financial Markets LLC

    I HAVE RECEIVE NOTHING FROM Vision Financial Markets
  3. Yes I got the 30% from Vision. I am hoping for a lot more than 30% eventually though.

    Are they claiming that you have not submitted enough documentation? I know that some people had that problem with them.

    Also did you complete the proof of loss form on That is not needed to get the money from Vision but is needed for later distributions. If anyone missed the deadline, I would suggest submitting now anyway with an explanation and there may be a good chance that the trustee will ask the Court for permission to accept late claims where there was a reason (such as language difficulties, remoteness, etc.)
  4. But they are different pools. That is the entire point of segregation. Of course the industry has sold segregation as safe but that sales pitch has always ignored reality. If 100% of the money customers are led to believe is safe is in the pool your funds reside in you will get 100% back. If 50% is there (the other portion gone as the result of fraud or clients blowing up or WHATEVER!!) you get 50%.

    Foreign accounts (type 30 accounts) should always have funds segregated into their own basket. I'm not suggesting I know how any given court will rule or what will happen on appeal but the system has always been clear for those that looked closely and only a mystery to those that blindly accepted industry drivel. If you wake up on any given Tuesday expecting that your broker will tell you the truth about how vulnerable your balances are ... go back to bed as you are a danger to yourself and potentially others.

    A SIPC style insurance scheme is what is good for the retail customer. The cost would be modest and the certainty of recovery up to the stated limits nearly 100%.

  5. Shorty53


    I also had a futures account with PFG and to date have yet to receive anything. Feels like being ripped off twice. Don't understand why some have gotten a payment and others not.
  6. Did you receive a letter from Vision? If not, maybe your address has changed or the letter just got lost. Did you send them the documentation they asked for?

    All accounts got 30% transferred to Vision and it is sitting there waiting for you to file your drivers license etc. and then they will send you a check.
  7. Well after you already have the loss, the practical issue at hand is not about believing industry drivel etc. at that point. It is about trying to make the best case you can to recover as much as possible as you can in the circumstances. I am going to have to study the law closely myself.

    I am just focused on the case at hand right now but for the future, yes, I agree that there should be insurance. If the Canadian investment industry can have a privately-funded insurance plan that includes futures accounts up to $1 million, so should the U.S. If anything, it should be easier here because we have the exchanges here to perhaps bear part of the cost.

  8. I agree that making the best case you can makes sense but saying, as you did:

    "Wouldn't it be fairer to treat the two equally?"

    Is not the way to go about that. In fact it would be much less fair.

  9. It remains to be seen how the Court would/will decide.

    Courts are courts of equity as well as of law.

    If we can find irregularities in the bookkeeping of both sets of accounts, then the division of funds between them may be up for argument.

  10. the problem besides the ineffective CFTC, their FIVE commissioners who've sat thru
    years of client funds being stolen without doing a thing to prevent repeated thefts by
    utter imcompetent futures brokers or outright theft, and, the system of US law that
    permits clients' funds to be included in arguments about who has what claims to the
    monies remaining at the bankrupt brokerage

    the Canadian CIPF wasn't successful just because there IS insurance - up C$1M per
    client account, but that the CIPF brought an action against MFG Canada in a bankruptcy
    court where some of the funds held by MFG C were ruled by the court as belonging to
    MFG C clients - not MFG C, thereby removing client funds from a general bankruptcy
    action prior to such action
    #10     Dec 29, 2012