Futures Brokerage PFG Best Freezes Accounts Following Discovery Of Accounting Irregularity

Tyler Durden's picture

Update 3: Russ Wasendorf Sr., the founder and CEO of PFGBest, reportedly attempted to commit suicide this morning outside the corporate headquarters in rural Cedar Falls, company officials confirmed Monday afternoon.

Update 2: PFGBest had $400MM in customer segregated funds at the end of April. Is JPMorgan about to "discover" another $400 million in Q2 "profits"?

Update: PFGBest Plans 'Several Hundred' Layoffs, Spokeswoman Tells Dow Jones - Dow Jones. Sounds like a good idea in the facec of liquidation

Just out from futures broker PFG Best to clients, where the owner's suicide attempt apparently has led to a whole new MF Global spin off.

Monday, July 9, 2012


Due to a recent emergency involving Russell R. Wasendorf, Sr., a suicide attempt, some accounting irregularities are being investigated regarding company accounts.  PFGBEST is wholly owned by Mr. Wasendorf.  Therefore, the NFA and other officials have put all funds on hold, and PFGBEST is in liquidation-only status with our clearing FCM.  What this means is no customers are able to trade except to liquidate positions. Until further notice, PFGBEST is not authorized to release any funds.  We will update you as any new procedures are stipulated and with any further information as it becomes available.

... And just as the public trust was storming back into the capital markets.

From Reuters:

Small U.S. futures brokerage PFGBest told customers on Monday that its funds had been put "on hold" as it investigates accounting irregularities following an apparent suicide attempt by the firm's owner.


The Cedar Falls, Iowa-based broker, which had about $400 million in customer segregated funds at the end of April, said it was in "liquidation-only" status with its futures commission merchant (FCM), meaning that "no customers are able to trade except to liquidate accounts," according to the notice.


It said the National Futures Association (NFA) and other officials had put all its funds on hold.


PFGBest officials were not immediately available to comment. One PFGBest broker verified the letter. A second source familiar with the company said owner Russell R. Wasendorf, Sr., had attempted to commit suicide at the firm's Iowa compound.

From WCF Courier:

Prominent Cedar Falls businessman hospitalized after suicide attempt


Russ Wasendorf Sr., the founder and CEO of PFGBest, reportedly attempted to commit suicide this morning outside the corporate headquarters in rural Cedar Falls, company officials confirmed Monday afternoon.


Wasendorf was taken to Sartori Memorial Hospital this morning, then later was airlifted to University of Iowa Hospitals and Clinics, where he was in critical condition.


Emergency crews were called to the headquarters shortly after 8 a.m. after employees found a man in a car near the headquarters building, located near the Beaver Hills Country Club.


The National Futures Association, the self-regulating organization of the United States futures industry, has placed PFGBest on a “liquidation only” status due to Wasendorf’s condition. The company is wholly owned by Wasendorf.


The company stated that all funds have been put on hold, meaning customers will only be able to sell off their interests, until future notice.


According to company officials, accounting irregularities are being investigated.


Wasendorf, the founder of PFGBest, an international brokerage firm, moved the corporate offices of the company from Chicago to rural Cedar Falls in 2009. He had started the company in Chicago in 1990.


Wasendorf is a Cedar Falls native who started his business in his hometown.

Meet Russell R. Wasendorf, Sr.

PFGBEST's Leadership

Russell R. Wasendorf, Sr.
Chairman and Chief Executive Officer of PFGBEST

PFGBEST, the brand that evolved from Peregrine Financial Group, Inc., was incorporated in 1990 and has grown to become one of the largest U.S. non-clearing futures brokerage firms.

Russell R. Wasendorf, Sr.PFGBEST has a presence in the world’s major financial centers, plus a network of more than 700 branches, introducing brokers, foreign introducing brokers and Commodity Trading Advisors (CTAs) serving customers in 80 countries. The company is an industry leader in technology innovations to benefit online traders and investors. It has multiple proprietary online trading platforms that have been spun off of the original BESTDirect Online Trading system, which was one of the very first to deliver customer orders directly into the Globex trading engine of the Chicago Mercantile Exchange, in 1998.

Throughout the 1980s, and 1990s, Russell R. Wasendorf, Sr. invested in technological capabilities to create the BESTDirect Online Trading platform, well before other brokerage firms were engaged in this science.

Today, the BESTDirect Online Trading platform continues to be known for its efficiency and reliability, making futures and forex markets more transparent and more easily accessible for all participants. PFGBEST has grown to be a liquidity provider that is completely unbiased and diversified to accommodate trading strategies across a variety of asset classes, including futures, forex, options, securities and precious metals.

PFGBEST has a leading position in online futures, forex and options; retail brokerage; forex services for individual and institutional clients; managed accounts; demand-inspired new technologies and investor education.

Russell also founded SFO – Stocks, Futures and Options, the Official Advocate for Personal Investors – in 2001. The magazine became one of the most widely-distributed monthly publication specializing in these investments, and today it is completely digital.

He is a noted writer and educator, having written or co-written six books about futures and trading. These include: Commodity Trading: The Essential Primer; All About Futures From The Inside Out; All About Commodities From The Inside Out; All About Options From The Inside Out; All About Managed Futures From The Inside Out; and The Complete Guide To Single Stock Futures.

In 2007, Russell founded W&A Publishing, a firm that has brought numerous authors to market and developed a reputation as “the trader’s tutor”. In 2009, he purchased the assets of another well-regarded investment publisher, Trader’s Press, and moved the business to Cedar Falls, Iowa. The two were merged under the Wasendorf & Associates, Inc. brand in 2010.

Russell is widely recognized as an expert and industry voice in many venues, advocating on behalf of efficiencies for individual investors. He serves on the FCM Advisory Committee of the National Futures Association (NFA).

He is one of the original partners in a real estate development company, Avrig 35, headquartered in Bucharest, Romania. Avrig 35 has built some of the most significant commercial buildings in East Europe during the past decade.

He sits on the Board of the Peregrine Fund along with notables including Patricia Disney, Julie Wrigley, Lee Bass, Henry Paulson, Jr. and Paxton Offield. The Peregrine Fund is a non-political, science-based organization in Boise, Idaho, which works worldwide to conserve wild populations of birds of prey. He also sits on the President Committee of both the University of Iowa and the University of Northern Iowa.

Russell began his career as director of public affairs for the American Soybean Association and is a photographer and cinematographer. After that, he worked with Commodities Magazine from 1976 to 1980 and was Director of the Commodities Educational Institute, an affiliated entity. In 1980, he started Wasendorf & Associates, and he founded the Center for Futures Education. Wasendorf & Associates created an Introducing Brokerage arm – Wasendorf & Son Company – in 1986. Peregrine Financial Group, Inc. was born in 1990 to better serve trading customers.

Russell’s philanthropic endeavors are channeled through Peregrine Charities, a private family foundation that he founded in 2004, with a charitable focus on research and cures for rare childhood diseases and help for the families facing these illnesses.

He received two honors in 2010: the Patriotic Employer Award, for support of the U.S. National Guard and Reserve and employees who are serving or have served in the military; and, the Treating Capital Award from the Cedar Valley Alliance and the Cedar Falls Chamber of commerce for providing regional opportunities in technology employment and commitment to green practices and sustainability efforts.

* * *

And while Senior obviously had some problems, as confirmed by his Finra record, his son appears to have had some close encounters with the regulators as well.


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TraderTimm's picture

Fortunately there's a system that isn't under control of any wannabe-CORZINE bastards, or Ctrl-P Economists.

Bitcoin - because all this crap is just the beginning of the end for FRNs and fancy paper currencies...


No account minimums, exorbitant fees, flawed regulators, capital controls, bank 'snitching' reports.


Fidel Sarcastro's picture

PFG getting Corzined, eh?  Surely this is bullish AND will never....ever...happen again.

Manthong's picture

Sounds like a few folks won’t be sad about this development..







Russ Wasendorf Sr.
Russ Wasendorf Jr.


Mentaliusanything's picture

And Madoff is alone in his Cell thinking... WHY JUST ME

NumberNone's picture

And where the hell were the regulators that were supposed to prevent this sort of shit?  Doesn't look like you have to scratch deep in this company to find the rot. 

Silver Bug's picture

The scamsters continue on. We are infested with them.



MarsInScorpio's picture

True. And nothing will change until they start being put in jail for their crimes.


But . . . when you have a US AG who makes his fortune keeping Wall Street criminals out of jail . . .


Rasna's picture

Jon Corzine was seen dressed in white coveralls loading several large bags into a panel truck parked at the rear loading dock of PFG... You don't think... !!!??


Rasna's picture

Also, As Reggie said to Lauren, "There is never just one roach!"

How true, how true...

partimer1's picture

FUBAR. Sorry folks.

Tinky's picture

"...is not authorized to release any funds."

I wonder how often that chilling refrain will be repeated over the next couple of years?

MarsInScorpio's picture

. . . because they really don't know if they have any funds to release?


LeBalance's picture

yours was an allocated or an unallocated account, please sir?

Oracle of Kypseli's picture

You may have better leverage if you keep the futures position you have.

LeBalance's picture

"Mr. SEC Auditor, these are not the segregated accounts you are looking for."


tmosley's picture

"Look, hardcore pornography!"

LawsofPhysics's picture

Just another snowflake in the avalanche of that trust deficit.  Wake me when the guillotine is rolled out and put to use.

runlevel's picture

i wonder if he tried to stab himself a bunch of times like that dude in the UK found stabbed to death by "suicide" ... lol figure that one out. Maybe "Suicide" is the actual name of the banksters hit man squad. "Another banker dead by suicide" ..

camaro68ss's picture

He was later found with self inflicting wounds in the back. it was ruled a suicide.


israhole's picture

I wonder if this guy is Jewish?

tmosley's picture

I wonder if people really think that collectivism is predictive?

vast-dom's picture

nah he's a fucktard christian or is it catholic, and possibly a mid-western hick that just got lucky? you really are a POS israhole.

FeralSerf's picture

Jooze usually don't attempt suicide.  They see nothing morally wrong with stealing from Gentiles.  Remember Corzine and Madoff's response?   Do you think Jamie or Lloyd would try suicide if their gig is ever over?

tmosley's picture

I get the feeling someone was standing for delivery on the Comex.

When will they learn?

Unprepared's picture

I would never trust failed-suicider with my money.

Godisanhftbot's picture

 Nothing on the pfg website.

stock trout's picture

I had a cup of PFG Best this morning at breakfast. No wait, that was MFGlobal...no it was Seattle's Best, or maybe JFG. I'm confused.

Who would invest their money with an institution called PFG Best, or drink JFG coffee for that matter.

Vegamma's picture

Some of the MFG accounts were transferred to PFG Best when MF collapsed. Out of the frying pan, into the fire.

NotApplicable's picture

So, I wonder if Dimon gave him the "your customer money or your life" call?

(after he'd spent the money)

chdwlch1's picture

I should have never had that second cup of PFG Best this morning...ironically, it caused some bowel movement "irregularities" so painful I wanted to kill myself...In the end, all that was left was a big pile of shit.

john_connor's picture

The writing is on the wall.  All funds that one has in the "system" are at high risk of confiscation due to systemic failure and lawlessness.

MarsInScorpio's picture

Great point.


This is the result of allowing the criminals to have impunity, en mass.


The only ones who have a realistic chance of being jailed are the ones like Madoff, who stole from his fellow ruling elites. TPTB don't care what you do to the sub-species; steal them blind because they are no one of any importance anyway.


azusgm's picture

The only ones who have a realistic chance of being jailed are the ones like Madoff, who turned himself in then copped a plea. He is spending the rest of his life in Club Fed, tucked away from his fellow elites as much as possible.

FEDbuster's picture

Convert your "funds" to food, supplies and PMs, store them at your home and rest easy knowing that they are safe in YOUR safe.  Buy the appropriate tools to defend your physical wealth and life preservation investments.

hedgeless_horseman's picture



Realize that everything is likely to cost more next year, if you can get it, so better to buy it now.

Was $4,500 on May 10, and is now $5,200, a 16% increase in two months.

logicalman's picture

Get fit.

Yesterday I did a bike/hike that nearly killed my teenage son.

I'm knocking on the door of 60

I can bug out without gasoline.


israhole's picture

Funny, they've frozen withdrawals but they'll still let you open an account.

cougar_w's picture

All Ponzis end that way.

Lucky Guesst's picture

Deposits still welcome LOL

it's sad there are people that stupid

mt paul's picture

stand for delivery

or die trying ...

world_debt_slave's picture

ha, ha when the cockroaches start attempting suicide, you know the time is near. Be prepared.

LeBalance's picture

attempting?  try a hot tub and a hair dryer....

JPM needed some dough and got out the *he won't be missed list.*

YesWeKahn's picture

Nice, I guess that the future is surging on this.

monad's picture

Thats not a suicide attempt, thats a golden parachute malfunction.

q99x2's picture

Take that honest face to the bridge.

Stuart's picture

Cockroach theory about to play out BIGTIME baby!!!!!

Temporalist's picture

It's a good thing CNBC has so much credibility:

Two Firms Flourish in Frenzied MF Global Aftermath

"Executives contacted by Reuters said ending up with some additional clients from MF Global's demise was bittersweet.

Iowa-based futures brokerage PFGBEST, a smaller independent broker about one-quarter the size of RJO, had issued a press release shortly before the first transfer arguing against "allowing regulators and exchanges to force [customers] to any particular futures commission merchant."

PFGBEST was ultimately given some accounts in a second transfer. But of the 700 accounts with some $200 million in cash that it received, less than 40 percent have remained with the broker, said Russell Wasendorf, chief operating officer.

"I think some firms were trying to look at it as a land grab," he said. "Our major concern was to give customers their money." And if the customers realized during the process that his firm provided them good service, "that was the only real benefit that we saw out of this.""


Fred Hayek's picture

I guess "flourish" is as hard to define as "swap".