PFG Forex Metals Legal Account

PFG Forex Metals Legal Account

Bankruptcy Documents Referencing the Treatment of FX/Metals Accounts:

  • Read our PFG Forex Metals Group Adversary Complaint submitted 10/15/2012 by Drohan Lee LLP.
  • Read footnote 11, page 340 of the Motion to Liquidate FX Accounts submitted 7/27/2012 states we are not PFG “customers” under the bankruptcy code and that the treatment of our claims and distributions is unknown.
  • Read section C8 – C12 (especially sections C11 and C12), pages 8-9 of the Motion Approving Interim Distributions to Certain Customers submitted 9/05/2012 once again states that we are not considered PFG “customers” under the bankruptcy code and will not be included in such distributions.
  • Read sections 16&17, page 10 of Notice of Motion to File Proofs of Claim submitted 9/18/2012 states Forex and Metals account holders are not “customers” under bankruptcy code and the Claims. Process does not address the issue of the treatment of the claims of Forex and Metals Customers.
  • Read pages 14-16 of the PFG Presentation to Customers and Creditors submitted 9/10/2012 lists the shortfalls and balances in the domestic futures, foreign futures and FX/Metals accounts.
  • Read pages 10 & 12 and exhibit B-2, pages 19 – 23 of Schedules A, B, D, E and Schedules F Parts 1 – 7 submitted 9/06/2012 lists PFG’s liabilities at $525 million and its assets at $270 million – numbers including Customer Accounts and Financial Accounts respectively.
  • Read footnote 2, page 16 of the PFG Presentation to Customers and Creditors submitted 9/10/2012 states that while cash related to our contracts was kept in separate accounts, Forex/Metals customers should not draw conclusions on potential recoveries due to specific legal issues which need to be resolved.
  • Read the Trustee’s Message to Forex and Metals Customers posted to the website 10/03/2012 which makes statements such as: “the Forex and Metals customers are not included within the definition of “customer” found in the Bankruptcy Code”, “every bankruptcy case involves multiple creditors (or in this case, customers) whose respective claims are entitled to different treatment under the law”, “the Bankruptcy Court will decide the treatment to be afforded to their Forex and Metals positions.”
  • Read the Trustee’s Motion to Dismiss Adversary Complaint submitted 11/13/2012 which makes statements such as: “funds deposited by the Forex Claimants for trading off-exchange currency transactions are not subject to the customer funds protections”, “in the event your dealer becomes bankrupt, any funds the dealer is holding for you may be treated as an unsecured creditors’ claim”.
  • Read the Trustee’s Memorandum of Law in Support of Motion to Dismiss submitted 11/13/2012 which makes statements such as: “The Forex Claimants seek a declaration that the funds held by Debtor are not property of the estate … the Forex transactions are “commodities contracts” … that the funds deposited by them are “customer property” but the Contract and Forex Risk Disclosure defeat their claims”, “They purport to identify themselves as “customers” and contend that the Forex transactions are “commodities contracts” in order to take advantage of a statutory and regulatory scheme that explicitly does not apply to them.”, “Forex transactions do not afford participants with the same protections afforded customers in commodities transactions”, “the Debtor had unfettered discretion with respect to its use of those funds”, “In the event of Debtor’s bankruptcy, funds transferred in connection with Forex transactions would be treated “as an unsecured creditor’s claim” without regard to whether those funds were maintained in separate deposit accounts.”, “Imposing a constructive trust in the bankruptcy of a commodities brokerage would elevate the Forex Claimants to the status of “customers” under the Bankruptcy Code”, “Section 766 of the Bankruptcy Code establishes a priority scheme unique to commodities brokerage bankruptcies”, ““customers” have priority over all creditors except administrative claimants”, “Forex Claimants are not considered “customers””.
  • Read the Trustee’s Reply in Support of His Motion to Dismiss submitted 12/17/2012 which makes statements such as: “funds relating to the Forex transactions may be treated as an unsecured creditor’s claim in the event of Debtor’s bankruptcy”, “The Forex Claimants have not, and cannot, establish that they qualify as “customers” under Bankruptcy Code”, “The relief requested by the Forex claimants is precisely the relief that the Forex Risk Disclosure told them might be unavailable with respect to their Forex accounts in the event of the Debtor’s bankruptcy.”, “in the statutes regulating commodities contracts the Forex Claimants were told that Forex transactions were not subject to those regulations and that their Forex accounts were not afforded those protections”, “funds deposited in connection with Forex transaction may be commingled with the Debtor’s own operating funds or used for other purposes”, “the Bankruptcy Code seeks to distribute the remaining property of the estate as equitably as possible … creditors must wait their turn according to the statutory ordering of claims”, “it would be inequitable to impose a constructive trust over the Forex funds allowing the Forex Claimants to leapfrog over many other customers and unsecured creditors”, “Section 766 recognizes a distinction between “customers” and other unsecured creditors of the Debtor”, “Section 766 of the Bankruptcy Code provides that the Trustee in a commodity broker liquidation proceeding shall distribute customer property ratably to “customers” on the basis and to the extent of such customers’ allowed net equity claims and in priority to all other claims except for certain administrative expenses.”, “only “customers” share in the pro-rata distribution of “customer property””, “the Forex Claimants are not “customers” and cannot share pro rata in the Debtor’s pool”.
  • Read the Trustee’s Motion for an Order Approving Recognition of Futures, Foreign Futures and Delivery Account Classes of Customers submitted 2/25/2013 in which FX and Metals customers are omitted from recognition as a customer account class for future distributions under Part 190 Rules.

Media Coverage:

  • “US Bancorp sued over ‘Midwest Madoff’ brokerage accounts”, David Sheppard and Tom Polansek, 6/5/2013, REUTERS article
  • “Peregrine Customers Get Good News”, Jacob Bunge, 2/27/2013, available on (with subscription)
  • “Victims Jockey to Maximize refunds in PFGBest Case”, Ryan J. Foley, Associated Press article, 1/30/2013, available on
  • “Peregrine’s Wasendorf Sentencing Set for Jan. 31″, Jacob Bunge, 1/14/2013, available on (with subscription)
  • “Peregrine Financial’s Forex Traders Push to Reclaim Funds”, Jacob Bunge, 10/18/2012, Dow Jones Newswires article, available on (with subscription)
  • “Forex Metals Customers Want Justice”, Alanna Byrne, 10/11/2012, article
  • “Peregrine Financial Trustee Turns to Currency Accounts”, Jacob Bunge, 10/4/2012, The Wall Street Journal article, available on (with subscription)
  • Several PFG Articles available at:

Related Websites and Blogs:

  • PFG Trustee Cash Summary: cash, account funds, disbursements, professional fees as of 3/15/2014
  • CFTC vs. Jeannie Veraja-Snelling: CFTC Permanently Bars PFG’s Auditor
  • CFTC vs. US Bank: Complaint Seeking Permanent Injunction, Civil Monetary Penalties, and Other Equitable Relief
  • CFTC vs. US Bank: CFTC Alleges Unlawful Use of PFG’s Customer Segregated Funds and Violation of Customer Segregation Laws
  • “Some Potential Heat for Frozen PFG Accounts — Action Suggested”, Foremost Trading blog, 6/14/2013
  • Peregrine Financial Group, Inc. Trustee Website (
  • PFG Court Docket

Wasendorf Case Updates:

  • United States V. Russell Wasendorf, Sr.
  • CFTC vs. Peregrine Financial Group, Inc. and Russell Wasendorf, Sr.

Congressional and Regulatory Contacts:
Communicate with members of the U.S. House and U.S. Senate Agriculture Committees, the CFTC, the NFA and your U.S. Congressmen and women and voice your concerns about the need for retail Forex and Metals protection.

  • Contact the: U.S. Commodity Futures Trading Commission (CFTC)
  • Contact the: U.S. House Committee on Agriculture
  • Contact your: U.S. Senators
  • Contact your: U.S. Representatives
  • Contact the: U.S. Senate Committee on Agriculture, Nutrition & Forestry
  • National Futures Association (NFA): Contact Page

PFG Bankruptcy Proof of Claim Forms Information:

  • Trustee Proof of Claim Forms and instructions:
  • Trustee Proof of Claim Form deadline: Bar Date Extension
  • Trustee Proof of Claim Form Frequently Asked Questions: FAQs Page
  • National Futures Association (NFA) Claim Form information:
  • Foremost Trading Clients – Claim Form FAQs:
  • Millenium Trust Clients – Claim Form questions: Email or call 1-800-932-0053

Joyce Wells |

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