I have an account with Refco Private Client Group (www.refcopcg.com)
which is a subsidiary of Refco. A scandal with the CEO was uncovered
this week (where he allegedly borrowed money from Refco) that is
developing into a crisis. Bonds have fell 70 cents to the dollar, and
the stock fell over 60%, and is now frozen from trading. Just
yesterday, they had to shut down their Capital Markets Division
because of illiquidity.
I'm really worried about my account and what implications this recent
news will have. While Refco has maintained that their futures
brokerage division (Refco, LLC) is still operating and is meeting
capital level requirements, I'm not sure if their credible anymore.
I basically have 2 questions.
1) Should I pull my money out now before it's too late?
2) If Refco goes bankrupt, what protection do I have as a customer? Is
there a possibility that I'll lose all my money? |
Request for Question Clarification by
pafalafa-ga
on
14 Oct 2005 12:23 PDT
Wow! Talk about a crash and burn...I've never seen a company nose-dive
quite so abruptly.
My sympathies. I'm no expert in these things, and I'm not at all
familiar with Refco, but if your account represents your assets --
rather than Refco assets -- I think it might be OK, though it might be
hard to get access to it for a while.
If it's Refco money and they go bankrupt (as theyu rapidly appear to
be doing), then you'll be pretty much at the back of the pack of
banks, creditors, etc trying to get a piece of what's left.
As for pulling your money out...Is there any down side? If not...do it!
Best of luck.
pafalafa-ga
|