Ex-Chief of Refco Faces More Charges

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The New York Sun

The U.S. Attorney’s Office in Manhattan has brought additional charges against the former chief executive of Refco, Phillip Bennett, in connection with a scheme to hide hundreds of millions of dollars in trading losses by the company and its customers, according to an indictment unsealed yesterday.


Mr. Bennett, 57 years old, has been charged with conspiracy, securities fraud, wire fraud, and making false filings with the Securities and Exchange Commission. He faces up to 20 years in prison on the securities fraud charge.


He was originally arrested and charged with one count of securities fraud under a criminal information issued last month. Refco placed Mr. Bennett on leave and has since sought Chapter 11 bankruptcy protection.


Mr. Bennett’s lawyer didn’t immediately return a phone call seeking comment on yesterday afternoon.


At the same time, a federal magistrate judge altered the terms of Mr. Bennett’s bail package yesterday, reducing the number of cosigners needed to secure his $50 million bond.


Now only his wife, son, and daughter need to serve as consigners, instead of six financially responsible cosigners. Mr. Bennett has been out on bail and on home confinement since October 27.


According to the indictment, prosecutors have alleged that Mr. Bennett and others, known and unknown to the government, sought to hide from Refco’s auditors and investors losses sustained by the company and its customers through trading in the financial markets from as early on as the late 1990s.


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