Peregrine CEO pleads not guilty to lying to regulators
By Ryan Schlader and Tom Polansek
CEDAR RAPIDS, Iowa/CHICAGO (Reuters) - Russell Wasendorf Sr., chief executive of failed futures brokerage Peregrine Financial Group, pleaded not guilty to lying to federal regulators on Friday.
The widely expected move likely sets the stage for an eventual plea agreement, legal observers said, after Wasendorf confessed last month to bilking his customers out of millions of dollars.
Wasendorf, 64, was indicted on Monday on 31 counts of overstating the amount of customer funds at his brokerage by tens of millions of dollars in faked monthly and yearly reports to the Commodity Futures Trading Commission (CFTC).
Peregrine filed for bankruptcy protection on July 10, one day after Wasendorf attempted suicide and left a note describing how he had stolen from customers for nearly 20 years.
The collapse of what was once a mid-sized futures brokerage has dealt a further blow to confidence in the futures industry, coming less than a year after MF Global Holdings Ltd's MFGLQ.PK bankruptcy, which left customers with a $1.6 billion shortfall.
In his first appearance since the indictment, Wasendorf on Friday shuffled into a small courtroom at the U.S. District Court in the Northern District of Iowa in Cedar Rapids, clad in an orange prison jumpsuit and tan sandals, with his hands and feet shackled.
"At this time he pleads not guilty on each count," his public defender, Jane Kelly, told Magistrate Judge Jon Scoles.
FACES UP TO 155 YEARS IN JAIL Continued...