Refco Trusts Say Thomas H. Lee, Grant Thornton Sued

NEW YORK (Reuters) - Trusts representing Refco Inc creditors said on Tuesday that certain customers of Refco Capital Markets broker-dealer sued Thomas H. Lee Partners [THL.UL], Grant Thornton and others.

The two lawsuits, filed in U.S. District Court in Manhattan, are the latest in a series of cases stemming from the collapse of the now-defunct futures and commodities broker. The plaintiffs in the latest suits are seeking hundreds of millions of dollars in damages and interest, Refco Litigation Trusts said.

Thomas H. Lee Partners and Grant Thornton could not be reached immediately for comment.

Refco and 23 affiliates filed for Chapter 11 bankruptcy protection on Oct. 17, 2005, a week after revealing that the former chief executive, Philip Bennett, hid $430 million in debt. The company had gone public two months earlier and later liquidated its operations.

The suits allege that certain Refco officers directed employees to sell securities belonging to the plaintiffs without their consent, the trusts said.

The suits allege that the proceeds from the sale were then taken out and used for other purposes at Refco, they said.

The suits also allege that the scheme began before Thomas H. Lee's leveraged buyout of Refco in June 2004 and continued during the period the firm directed Refco and its affairs, the trusts said.

Grant Thornton is named in one of the suits, the trusts said. The customers allege in the complaint that the former auditor of Refco would have uncovered the fraud if it had properly performed its audit function, the trusts said.

Others named in the suits include Thomas H. Lee and several of the firm's representatives who served as officers and directors of Refco, the trusts said.

The suits also name Bennett and a certain other former officers and directors of Refco, the trusts said.

Bennett, former Refco Chief Financial Officer Robert Trosten and former Refco President Tone Grant are separately awaiting trial on conspiracy, fraud and other charges.

(Reporting by Paritosh Bansal)