Probably??? Nice try zdreg. Do you always interpret other people's posts in order to grind your axe towards someone that has challenged the factual basis of one of your posts? - - - How lame.
Newbie here, so be gentle... After reading most of the posts it seems that the conclusions to be drawn here are limited. The problem for refco is that it was the CEO cooking the books, thus the credibility of all units are affected, not just the one where the books were cooked. All the books are in question. It also seems to me that when you have to pull out the legal books and read the fine print in all the regulations governing refco's businesses to figure out if your money is safe, the credit, credibility and viability of the company as a business is gone. Are funds safe? The company was caught in the past borrowing from segregated accounts, and they paid it back. If they have done this again, looking at the current state of their business, they might not be able to pay it back this time. The only way to say absolutely that funds are safe is to know absolutely that the company has been honest: there is just no way to say that right now. Which is why so many have been pulling out funds, why refco can't get credit at the moment, and why they have shut down some operations. For traders the risks are just too many. Did they borrow from segregated funds? Will the group you do business with pick up the phone when you call or will you get dead air because they all jumped ship knowing their bonuses are in the toilet? Were any more books cooked? It takes more than knowing that funds are safe. You also have to rely on the company to execute your trades, have liquidity and be there for you a week from now, something that cannot be guaranteed at any refco subsidiary. If you have to spend days reading law and fine print to figure out if you are safe (and then you could have missed something after reading 3000 pages!), why would you keep an account there? Why continue to do business with them? Would you open one here if you were looking right now? If not then why would you keep it here? Traders face enough tough decisions speculating about their investments. If you have to speculate about your broker being there for you as well..... it's a no brainer.
i assumed it was self evident that I wasn't talking abou the rank and file, as they are not the ones in the position to do such things.
just read:http://today.reuters.com/investing/...3_RTRIDST_0_FINANCIAL-REFCO-CFTC-UPDATE-1.XML And this is the CFTC official release:http://www.cftc.gov/opa/press05/opa5128-05.htm WASHINGTON, Oct 13 (Reuters) - U.S. regulators are checking whether customer funds are intact at Refco LLC after parent company Refco Inc.'s (RFX.N: Quote, Profile, Research) former CEO was charged with securities fraud, the Commodity Futures Trading Commission said on Thursday. New York-based Refco, through its CFTC-regulated Refco LLC futures commission merchant, is the largest independent U.S. futures broker. Refco's former chief executive Phillip Bennett was charged on Wednesday with securities fraud. Refco said on Thursday it would halt activities at its non-regulated Capital Markets unit for 15 days because its liquidity was no longer sufficient to continue operations. "CFTC auditors and attorneys are presently in the process of re-confirming that Refco LLC's customer funds on deposit remain uncompromised and that the capital requirements of Refco LLC are being met," the CFTC said in a statement. The agency said it was closely monitoring the Refco situation. "As part of this effort, the CFTC has been working closely with all concerned entities including, among others, the Securities and Exchange Commission, the Department of Justice, the Chicago Mercantile Exchange, and the National Futures Association," the agency said. The CFTC regulates futures and options exchanges
I can't believe how quickly this thing has snowballed. One day ago, people were talking how overdone this selloff was much like TYC or AIG, MMC. Now it is possibly going to be delisted. All the past scandals pale in comparison to the velocity of this unravelling!
1) my point was that this "problem" is spilling over into other areas. Areas that refco specificly said where UNAFFECTED just a day earlier - and that one would have to really have their head in the sand to think it might not be a systematic problem. Particularly since the company seems to have a culture and history of financial fraud issues including VIOLATING the segregated futures accounts. These things are driven from the folks at the top, so frankly I don't give crap about this company and that company - they are all REFCO, and refco apparantly is ran by dirt bags. I never said people were going to lose thier money. As a matter of fact, I said whether or not people lose their money - the company is still dirty. period. If i was a client of a CTA that continued to use refco in light of all this, I'd be one pissed MF'er.
Please cite a specific example in which the issues that have affected the closure of business at Refco Capital Markets have in fact, spilled over as you say into the futures division that handles segregated accounts. While credit lines and banking relationships are critical to the Prime Brokerage and foreign-exchange and fixed-income over the counter trading along with securities lending, please show how this effects the futures division and their segregated accounts. Last time I checked, Banks had very little to do with the margin FCM's extend to clients . . . This might come as a surprise to you, but when you buy a futures contract it is simply a performance bond given to the Exchange Clearing Corporation. As a fellow ET poster has stated ( Brandonf ), Banks have nothing at all to do with this. Again, please cite a specific example in which the issues that have affected the closure of business at Refco Capital Markets have in fact, spilled over as you say into the futures division that handles segregated accounts.
Spoken with my mate at fimat, he said they were still taking trades for give up refco - in the words of his clearing manager "they (fimat) do not play games"
did I say spilled over to FUTURES DIVISION? didn't think so.. what I said was that they specificly stated 2 divsions were not effected in any way.. 1 day later, it's turns out they lied about at least 1 of them. yes or no - has refco violated their segragated accounts before???? go ahead and continue to defend these dirt bags. It says alot about your character if you are not appalled by this.