The global hedge fund industry was preparing for a bloody nose today as the crisis engulfing US futures and derivatives trader Refco halted business in its biggest unit.
The embattled group has begun winding down Refco Securities, a regulated broker in America’s multibillion-dollar debt market. Refco Securities accounts for more than half the group’s gross revenues,the company stated in its prospectus for its August flotation.
Refco has also frozen customer accounts for 15 days in another US subsidiary, Refco Capital Markets, as the crisis sparked by fraud accusations threatens to drag it under.
