Refco ex-CEO Bennett officially quits all posts | VailDaily.com
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Refco ex-CEO Bennett officially quits all posts

WASHINGTON – Refco Inc. said its former chief executive officially resigned Friday and stepped down from the collapsed company’s board, its lawyers told a U.S. bankruptcy judge in Manhattan.Phillip Bennett had been on leave since the commodities brokerage accused him in early October of hiding $430 million in bad debt.His resignation followed an order from U.S. Bankruptcy Judge Robert Drain that Refco had to remove Bennett from its board of directors by Friday if it wanted to retain control over the remainder of its bankruptcy case. Failure to remove Bennett would have prompted the judge to appoint a trustee to oversee the case.Bennett, who has been indicted by federal prosecutors on charges of fraud and filing a false statement with the Securities and Exchange Commission, hasn’t participated in the board’s activities since Refco filed for bankruptcy on Oct. 17, the New York-based company has said.Deirdre Martini, the U.S. Trustee monitoring the case, contended that his nominal presence on the board raised questions about Refco’s ability to impartially investigate past wrongdoing by the company. She asked Drain to appoint a trustee to take over the case – a request the judge denied, on condition that Refco remove Bennett from its board and reconstitute the board by Friday.Refco’s disclosure of the alleged accounting fraud by Bennett caused its customers to flee and sent the company into bankruptcy. Since then the company has sold its flagship brokerage business, and has said it’s in the process of “winding down” its remaining operations.Vail, Colorado


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