At what point do we all finally come to consensus that our financial system is completely corrupted to the core and nobody is doing a damn thing to fix it? We have sat by and watched as one after another of these Titans of Finance steal, lie, embezzle and all the while cry for less and less regulation. Bemoaning ANY regulation at all while they are bailed out by taxpayers in order that they get their multi million dollar bonuses on time. Think Madeoff, Stanford, MFGlobal, JPMorgans whale, the muppet comments, the foreclosure fraud, MERS, LiborGate, Barclays and on and on and on it goes. Follow me below the fold for the latest scandal and apparent theft by one of these "smartest guys in the room".
The latest nail in the coffin for confidence in the Global Financial System came yesterday with the news that yet another brokerage has misappropriated funds (200 million vaporized this time) belonging to their clients. Apparently PFGBest had some discrepancies in their accounting of what they had on deposit.
The NFA said PFGBest had about $5 million on deposit at U.S. Bank despite claiming more than $225 million on deposit. It added that it received information Mr. Wasendorf "may have falsified bank records."And yes, these are derivatives traders. Remember the "financial weapons of mass destruction" as Warren Buffet put it? Well, we still haven't bothered doing anything to regulate them and they're still basically just stealing money hither and yon. I can't imagine how anyone can have any confidence investing with any of these thieves at this point. The industry has proven itself at worst to be corrupt and out of control and at best completely incompetent. And yet, we still are supposed to think they should be left to their own devices in fixing this mess they've made? Insanity is doing the same thing over and over and expecting different results. It appears this entire Planet is insane because I see nothing being done to change this or fix this.
As of June 4, PFGBest, which is largely engaged in retail commodities and foreign exchange trading, reported about $400 million worth of client funds on deposit to back up outstanding trades; this made it the 50th largest futures-commission merchant registered with the Commodities Futures Trading Commission.
PFGBest's woes come as another blow to a derivatives industry still reeling from the collapse of brokerage MF Global last year, which left thousands of retail and institutional clients nursing financial losses.
I know trying to get a handle on these issues is difficult. They made it complicated for a reason, so they can't be regulated. They don't even understand what they are doing some of the time but again, we're supposed to let them work it all out. We need to start getting loud about this because the end result when confidence in the market and financial sectors is completely lost will be a devastating collapse that will of course hurt the "little" people disproportionately. Already, investors are backing off and credit markets are tightening once again. It's beginning to look a lot like the Summer of 2008, let's don't go there again because this time there's no coming back from the Global shit storm that will be unleashed. Nothing short of a very long, Global Depression will be the result. It won't be the bankers suffering. Just some food for thought and a plea to all to try and get this stuff noticed more.
I didn't mention that the CEO of PFGBest attempted suicide when this was found out. He didn't succeed at that either. Here are some remarks by him about the MF Global debacle last year. .
“Every single day an FCM must file a segregated report. On Friday, prior to the (MF Global bankruptcy) everything was fine, on Monday the bells went off,” according to Russ Wasendorf, Sr., founder of FCM PFGBest.Yeah, I guess they do "work fine" if you can manage to steal a couple hundred million.
Speaking on PBS Nightly Business report, Wasendorf, a former NFA board member, offered one potential opinion on the case of the disappearing $600 million: “Something happened in the middle of that time. Futures regulations work just fine. Once the money was transferred it went into a new regulatory environment, probably covered by banking rules, which supersede the regulations of the futures industry.”