NEW YORK, Oct. 16, 2007 (PRIME NEWSWIRE) -- The Refco Litigation Trusts announced that they have filed a lawsuit seeking the return of more than $400 million from former Refco insiders. The lawsuit, filed yesterday in the United States Bankruptcy Court for the Southern District of New York, seeks return of preferential and fraudulent transfers from former owners, officers and directors of Refco who participated in a massive scheme to strip assets out of Refco.
The complaint alleges that the preferences and fraudulent transfers were concealed within and behind a number of fraudulently engineered financial transactions, including a surreptitious profits participation agreement funneled through Refco Group Holdings, Inc. ("RGHI"), a holding company controlled by defendant Phillip R. Bennett. Other insiders named in the action include Tone N. Grant, John D. Agoglia, Edwin L. Cox, Sukhmeet "Mickey" Dhillon, Thomas H. Dittmer, Stephen Grady, Eric Lipoff, Santo Maggio, Peter McCarthy, Joseph Murphy, Frank Mutterer, William Sexton, and Robert Trosten. The lawsuit also seeks to void the transfers of certain asset management companies and other transfers to RGHI.
Another lawsuit was filed by the Trusts in the United States District Court for the Southern District of New York against former insider Thomas Hackl and companies controlled by Mr. Hackl seeking the return of more than $5 million transferred to Mr. Hackl or companies controlled by him and for damages resulting from Mr. Hackl's active participation in the fraud.
Marc S. Kirschner, Trustee of the Refco Trusts, said, "The lawsuits filed today are in addition to five other lawsuits filed by the Trusts and customers of Refco Capital Markets seeking in the aggregate more than $2 billion dollars of damages to Refco and its creditors as a direct result of the massive fraudulent scheme perpetrated for more than eight years by Mr. Bennett, with the aid and assistance of numerous insiders and third parties."
Over the last several days the Trusts also brought more than 180 lawsuits in the United States Bankruptcy Court for the Southern District of New York seeking in the aggregate more than $33 million from the return of preferential and fraudulent transfers, collection of accounts receivables and other causes of action against non-insiders.
About the Refco Litigation Trusts
The two Refco Litigation Trusts were created under the Refco Plan of Liquidation, which became effective on December 26, 2006. Marc S. Kirschner, the former Chapter 11 Trustee for Refco Capital Markets LLC, serves as Trustee for the Trusts. The primary purpose of the Trusts is to pursue all Refco estate claims and claims of certain electing creditors against third parties, with recoveries to be distributed in accordance with the terms of the Refco Plan of Liquidation.