The Commodity Futures Trading Commission on Tuesday sued U.S. Bank National Association for unlawfully using and holding customer segregated funds that were misused by Russell R. Wasendorf Sr. before his futures commission merchant, Peregrine Financial Group, collapsed. The bank, a unit of U.S. Bancorp, rejected the accusation and said it was the CFTC that deserved blame in the case. In July 2012 Wasendorf admitted defrauding over 24,000 Peregrine clients and stealing more than $215 million using a customer segregated account the FCM had at the bank since 1992. In connection with his fraud, he misrepresented to the National Futures Association and his firm's auditor that Peregrine's customer segregated account at U.S. Bank held $200 million or more, when in fact the average balance since May 2005 was only $15.7 million. He pled guilty to federal criminal charges and on January 23, 2013 was sentenced to 50 years in prison and ordered to pay full restitution. "The Commodity Exchange
↧