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Tag Archives: Peregrine Financial Group

Getting Squeezed: Introducing Brokers Numbers Waning, Growth Wanting, Future Questioned Blog,Commentary

New Introducing Broker numbers hit historical low; IB Numbers Shrink 17 percent Since Financial Crisis There is a funny story about former MF Global CEO Jon Corzine, when he held his first all company conference call with employees. He said he was impressed with how many investment bankers the firm had, having no clue that the number of IBs affiliated with MF Global actually meant introducing brokers. The fate of the company was probably sealed right then and there. While investment bankers have had their own problems in recent years, it is introducing brokers whose best days seem behind them….

New Rules: NFA’s Dan Roth on Confirmations, Residual Interest and the Corzine Rule Interview,Regulation,Video

After the twin scandals of MF Global and Peregrine Financial rocked the futures industry in 2011 and 2012, the National Futures Association underwent a review, not only of its internal procedures, but also of its rules. In Part Two of this two-part John Lothian News exclusive, NFA CEO Dan Roth summarizes the changes made to the agency’s rules to restore customer confidence. Much of the rulemakings addressed by the NFA center on segregated funds – funds owned by customers that are placed on deposit with a futures commission merchant to cover margin on customer positions. “The most important and effective…

Internal Affairs: NFA CEO Dan Roth Highlights Changes in the Wake of MF Global and Peregrine Bankruptcies Blog,Regulation,Video

**Editor’s Note: As news content and technology continue to change, so do we at John Lothian News. Please take a look at our interview with Dan Roth of the NFA, and click on the embedded video sidebar, at the 1:09 or 3:40 minute, marks to see more of our interview. After the twin scandals of MF Global and Peregrine Financial rocked the futures industry in 2011 and 2012, the National Futures Association, underwent a review, not only of its internal procedures, but also of its rules. In Part One of this two-part John Lothian News exclusive, NFA CEO Dan Roth…

A Look at Forensic Accounting and Financial Fraud Interview,Regulation,Video

John Hague and Christen Morand

In the aftermath of the Peregrine Financial Group fraud, many wondered how it could have happened and how forensic accounting works after a fraud occurs. On June 20, John Lothian News president and editor-in-chief Jim Kharouf moderated a panel at the Women In Listed Derivatives (WILD) event on forensic accounting with John Hague, financial services industry leader with McGladrey and Christen Morand, senior manager, Ernst & Young. He sat down with both separately to ask about the accounting space today and how forensic accounting digs into fraudulent cases. Morand talks about the three categories of fraud that her team at…

FIA Boca Preview: Walt Lukken on the 2013 Outlook for the Futures Industry (Part 1) Interview,Regulation,Video

Walt Lukken FIA Boca

Walt Lukken has had his hands full since taking the top spot at the Futures Industry Association (FIA) in March 2012. With FIA Boca set to start on March 12, JLN editor-in-chief Jim Kharouf spoke with him about the industry over the past year, including the fallout and reaction to MF Global and Peregrine Financial Group, the outlook for brokers and why the president and CEO of the FIA believes 2013 will be better than 2012. In advance of the FIA Boca 2013 conference next week, John Lothian News traveled to Washington D.C. this week to interview Walt Lukken, president and…

Confirmations: NFA and CME’s Financial Match.com Regulation,Video

Chris Hehmeyer

The fraud at Peregrine Financial Group was uncovered in July 2012 by the National Futures Association (NFA) which used an electronic bank account confirmation system. (See Confirmations: Plugging Into Electronic Confirmations) In November 2012, the NFA and CME Group announced they would implement an electronic confirmation system for futures brokers. The system, operated by AlphaMetrix, provides a comprehensive check and match of what FCMs say they have in customer funds with what banks say they have. Chris Hehmeyer, CEO of HTG Capital Partners and chairman of the NFA, says the new system will help regulators and customers assure such a…

Confirmations: Plugging Into Electronic Confirmations Regulation,Tech / HFT,Video

Confirmations: Plugging Into Electronic Confirmations

Capital Confirmation, which runs Confirmation.com, is credited with helping to unveil the massive $215 million fraud at Peregrine Financial Group (PFG) in July 2012. The web-based audit confirmation service was hired by the National Futures Association (NFA) last year and applied its technology to PFG. After forcing PFG to use the electronic confirmation service, rather than use the traditional paper-based auditing system, PFG’s fraud was discovered by the NFA. Brian Fox, founder and chief marketing officer of Capital Confirmation, explains how this straightforward technology of providing a third party confirmation service, can help protect customer funds and restore customer faith…

Time to Restore Commentary,Regulation,Tech / HFT

Jim Kharouf

We are now well past a year since MF Global‘s collapse seriously damaged the futures industry and now trekking toward six months since the Peregrine Financial Group went down in flames, taking more customer money with it. Since November, after spending four months putting together solutions to those problems with our Restoring Customer Confidence video series, there’s been a small amount of industry action on what is arguably among the biggest threats to the futures industry’s growth – the lack of customer faith in the marketplace. It’s been the era of the four “L’s” – low volume, low volatility, low…

John Lothian Newsletter: NYSE says regulation hits retail investors; Australia Fund Managers Back Tax on High-Frequency Trading Firms; Regulators Seek Court Ruling Against Peregrine John Lothian Newsletter,Newsletter

NYSE prepares to tell Congress that current market rules give professional traders an advantage over retail investors, and that the regulatory structure must change in order to fix the disparity. In Australia, some fund managers are pushing for the imposition of a tax on high-frequency traders that flood the market with orders. The CFTC heads to court to ask for a fast resolution on charges made against Peregrine and its ex-chief Russell Wasendorf Sr. In today’s First Read, John Lothian takes a stand for new blood at the NFA. Also, be sure to watch our latest installment in JLN’s Restoring…