We’ve been keeping up with the developing story of the Chicago and Iowa-based brokerage firm, Peregrine Financial Group, whose assets have been frozen and whose CEO has been hospitalized after attempting suicide as federal authorities launch an investigation into a $200 million shortfall in customer-segregated accounts.
Now via Josh Brown, another Chicago firm, Attain Capital, some of whose assets were managed by PFG has published a lengthy note blasting PFG, its regulator the National Futures Association and the NFA’s overseer the CFTC.
“…it has become abundantly clear that our regulators are asleep at the wheel. The NFA answers to the CFTC, and the CFTC is to answer to Congress. Yet, the CFTC clearly failed to monitor NFA responses to the MF Global crisis, and we saw in the MFGlobal Congressional proceedings that our elected officials are more interested in political grandstanding than thorough investigation and effective questioning. Perhaps more importantly, they have little to no understanding of the way the markets they regulate over oversee operate.
“Let us make this clear- we are positively irate. We feel we have been betrayed by our business associates, regulators and government. We know the best course of action is to be level headed and deal with the facts as they come in, but the Chicago in us isn’t about to take this laying down.
They also go into detail about how to reform the market, and call for Congressional inquiries into the NFA’s and CFTC’s failings.