Marella, Gallwas, Ehrhardt and even Roe believe the small IBs that PFG catered to may be a thing of the past, but aren’t sure what will take their place.
PFG served a purpose, Marella says. “There isn’t another place out there that is as efficient in terms of getting the accounts opened quickly and having questions answered right away, and it took them years to get to that point.”
That raises the question of what happens to PFG’s infrastructure and trading platform, which was praised universally by users.
Bodenstein also has drawn fire from nearly all quarters, mostly for his lack of transparency compared to MF Global trustee James W. Giddens. “With MF Global, we knew within two or three weeks where things are going, and with PFG it took two months,” Gallwas says.
Sources close to Bodenstein, however, say he couldn’t have moved more quickly given the fear of inadvertently sending money to co-conspirators.
MF Global was different because the CFTC deferred to the Securities and Exchange Commission and the Securities Investors Protection Corporation (SIPC), which brought it under the purview of a trustee with securities experience. PFG, on the other hand, was in Chapter 7 liquidation. Industry insiders have complained about the SIPC trustee’s lack of experience with futures, yet he has managed to get funds out quicker than the PFG trustee.
As of press time, Bodenstein also appears caught in the middle of a regulatory blame game and is the man who must answer to angry customers waiting for their money.