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PFGBest Scandal Breaks After 20-Year Fraud

The PFGBest (Peregrine Financial Group) scandal breaks out and CEO Russell Wasendorf, Sr. has been arrested. Wasendorf attempted suicide and he did leave a suicide note. In the note he states that “the forgeries started nearly twenty years ago.”

Federal regulators have almost completely shut down the firm, only allowing liquidation of accounts. Accounts have been frozen because of the investigation, and some customers can’t even get their money out. The PFGBest case comes only months after the collapse of another trading firm, MF Global.

Jon Corzine, former CEO of MF Global, was never publicly charged with that scandal. The losses incurred by customers of MF Global stood at $1.6 billion and the majority of funds have not been returned to customers.

It is estimated that there are $200 million missing in customer funds at PFGBest, after falsifying bank records for years. The company has filed a Chapter 7, according to a Reuters report.

Wasendorf spoke in a video after his company was nominated for the Iowa Business of Character Award, in 2011.

Bruce Clark, the Nominator said this at the time:

PFGBest is a great corporate citizen. They demonstrate great corporate character, great citizen of the Cedar Valley, and just definitely a business with character. They’re a company that their customers and that their neighbors can trust and respect. They show caring for their employees by the at work services they provide. They show that they’re responsible for their environment with the nature of their building and the way they constructed their building.

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