Top Refco Exec Now At Man Financial

Dennis A. Klejna has become one of the first top-level Refco (RFXCQ) executives to resurface in a new job, rather than as a defendant in a criminal action.

The failed brokerage’s former executive vice president and general counsel is now “senior vice president and chief compliance counsel” of futures brokerage Man Financial Inc, according to a document he signed seeking clarification of a court order in a CFTC ‘wash trades’ action against an international narcotics money-laundering ring.

Court filings in the Refco action said that Klejna received $6.5 million in a profit-sharing agreement buyout at the time of Refco’s IPO, barely two months before the firm collapsed in Oct. 2005. Klejna had joined Refco in Jan. 1999, about four years after he left the CFTC where he spent 12 years as director of enforcement; his appointment was widely viewed as part of a strategy to clean up the broker’s tawdry image.

The UK-based Man Group plc, the world’s largest listed hedge fund manager, recently confirmed plans to sell a majority interest in its Man Financial futures brokerage operations—to be renamed MF Global—with “an [IPO] on the “New York Stock Exchange…in the third quarter of 2007.” Man Financial Inc acquired Refco’s regulated futures brokerage subsidiary, Refco LLC, after Refco’s collapse.

Klejna’s court filing was made in an action originally brought in early April against five foreign entities and individuals alleging wash trades in NYMEX contracts listed on the Globex electronic trading platform; a May 4 press release from the US Attorney for the Southern District of New York linked that action to the seizure of $5.6 million from Man Financial accounts controlled by a Dubai-based money launderer.

Man Financial is not accused of wrongdoing in either proceeding; indeed, the CFTC press release thanked Man Financial for its assistance in its action.

It is unclear when Klejna joined Man, or whether his recruitment was related to his recent experience with a brokerage IPO. Klejna did not return a phone call seeking comment. Press representatives for Man Financial originally contacted on Monday said that they were traveling on Tuesday, and could not respond to a request for comment until Wednesday, at the earliest.

CFTC files action against five foreign entities and individuals
Press release, Apr. 25 2007

US seizes over $5.6 million from Dubai-based money-launderer
Press release, May 4 2007