Peregrine reported about $400 million in customer-segregated funds around June 29, of which $225 million was on deposit at U.S. Bank, according to the National Futures Association. The regulator said it learned that Peregrine’s chairman “may have falsified bank records” after finding only $5 million on deposit.
Peregrine is being probed by the U.S. Federal Bureau of Investigation, said Sandy Breault, a spokeswoman for the agency’s Omaha, Nebraska, office.
MF Global’s failure was the first time a futures brokerage’s collapse led to the loss of customer money, which is supposed to be segregated in separate accounts, according to futures industry leaders. Parent company MF Global Holdings Ltd. filed the eighth-largest U.S. bankruptcy last year with debt of almost $40 billion after making $6.3 billion in bets on sovereign debt and getting margin calls. A $1.6 billion shortfall in customer funds remains.
The Peregrine bankruptcy case is Peregrine Financial Group Inc., 12-27488, U.S. Bankruptcy Court, Northern District of Illinois (Chicago). The CFTC regulatory case is U.S. Commodity Futures Trading Commission v. Peregrine Financial Group Inc., 12-cv-5383, U.S. District Court, Northern District of Illinois (Chicago).