Midsize futures brokerage PFGBest has frozen its customer accounts, after its founder attempted to kill himself—and left a suicide note hinting at financial irregularities. Russell Wasendorf, a 40-year industry veteran, was found in his car outside the company's headquarters yesterday, and is currently in critical condition at a University of Iowa hospital. The National Futures Association has issued an emergency enforcement action, preventing PFGBest's customers from making any trades, save to liquidate positions, the Wall Street Journal reports.
One broker at the firm tells Reuters that employees began packing their things as soon as they heard the news. "Pretty much everybody around here said, 'We're doomed,'" he said. The NFA thinks PFGBest "may have falsified bank records." It claims to have more than $225 million in deposits, but the NFA thinks the real number is closer to $5 million—and no, we didn't miss a digit there. "This is an abysmal failure by the regulators," says one broker that has used PFGBest.