Peregrine Financial clients face Friday deadline for claims
* Claims to CME's Farmer and Rancher fund due by 5 p.m. CDT
* Fund pays out up to $25,000 to individuals, $100,000 to coops
* Most Peregrine futures customer accounts had less than $50,000
By Ann Saphir
CHICAGO, Oct 5 (Reuters) - Former clients of Peregrine Financial Group, whose accounts were looted for years by the bankrupt brokerage's now-jailed founder, have until the close of business on Friday to petition exchange operator CME Group Inc to cover some or all of their losses.
Under an insurance scheme CME set up after last year's collapse of futures brokerage MF Global Inc left a $1.6 billion shortfall in customer accounts, individual customers of Peregrine Financial are eligible for up to $25,000. Farming and ranching cooperatives are eligible for up to $100,000.
"We are working to pay benefits in (the fourth quarter) to everyone who qualifies, so we needed a cutoff date in order to ensure we have all PFG applications in," a CME spokeswoman told Reuters. She did not provide any information on how many claims the company has so far received, or in what amounts.
Peregrine Financial filed for bankruptcy in July, after founder and CEO Russell Wasendorf Sr. confessed to stealing more than $100 million from his customers and tried to commit suicide.
The revelation that he had used a postal box and simple computer software to fool regulators for years sent shock waves through the futures industry, which had not yet recovered from the blow to customer confidence caused by MF Global's collapse less than a year earlier.
Wasendorf, 64, pleaded guilty last month to embezzling funds and to other crimes in a deal with federal prosecutors that could keep him in jail for the rest of his life.
The firm's bankruptcy trustee plans to return $123 million to futures customers in coming weeks, or about 30 to 40 percent of what was supposed to be in their accounts.
Wasendorf appears to have spent most of the remaining money, although a court-appointed receiver is working with an auctioneer to sell Wasendorf's assets to raise money that could ultimately be returned to customers. Those assets include a restaurant, the firm's headquarters and two homes in Cedar Falls, Iowa.
Peregrine Financial had about 17,000 futures customers and 7,000 clients who traded currencies. Most of Peregrine's futures customers had less than $50,000 in their accounts.
Payouts from CME's Family Farmer and Rancher Fund are available only to traders of crops and livestock contracts at the Chicago Board of Trade or the Chicago Mercantile Exchange.
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