“The U.S. Commodity Futures Trading Commission filed a lawsuit Wednesday against disgraced financier Russell Wasendorf’s bank for allegedly allowing the Iowan to use customer funds at his futures brokerage like a commercial checking account.
Minneapolis-based U.S. Bank NA, the fifth-largest commercial bank in the U.S., allowed Wasendorf to borrow against customer funds and use them for purchases ranging from a private plane to a divorce settlement, according to the CFTC.
The National Futures Association has embraced new mandatory online verification procedures to protect customer funds and rebuild confidence in the futures industry. Dennis Kelleher, president of Better Markets, a Washington, D.C.-based nonprofit organization that promotes the public interest in the financial markets, said the U.S. Bank lawsuit is part of that process.
“Financial crimes almost always require unwitting, negligent or greedy accomplices, but they are rarely prosecuted or held accountable,” Kelleher said. “The CFTC suing those alleged to have enabled Wasendorf to steal from his clients sends a long-overdue, clear message that crime should not pay for anyone.”
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