The jury is in. While of little consequence to the thousands of traders bilked by the principals at Refco, all of their trader clients must be getting some solace from the knowledge that Tone Grant was finally convicted on all charges at the U.S. District Court in Manhattan this week. After months of testimony, it only took two days for the jury to return a verdict that found him guilty of conspiracy, securities fraud, wire fraud, bank fraud, and money laundering. His conviction comes just two months after former Refco Chief Executive Phillip Bennett and Robert C. Trosten, the company’s ex-chief financial officer, pleaded guilty to criminal charges stemming from Refco’s collapse in late 2005.
As most traders know, the charges stemmed from the trio’s collaborative effort to hide the broker’s true financial health form participating banks, auditors, and investors. Ten years in the making, the firm’s troubles included hundreds of millions of dollars in trading losses sustained by the broker and customers trading through its accounts.
The company filed for bankruptcy protection in October 2005 shortly after the company announced that it had “discovered” a $430 million debt to a private entity owned by none other than the then CEO, Phillip Bennett.
The general consensus appears to be that Grant who is to be sentenced on August 7 will likely to spend the rest of his natural life in prison.
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