NEW YORK, Nov. 2, 2005 (PRIMEZONE) -- On Monday, October 31, 2005, Wechsler Harwood LLP and its co-counsel in FrontPoint Financial Services Fund, LP. v. Refco, Inc., et al., Case No. 05-Civ-8663 (DC)(RHM) (the "FrontPoint Action"), obtained a Temporary Restraining Order ("TRO") against ousted Refco, Inc. ("Refco" or the "Company") (Pink Sheets:RFXCQ) CEO and Chairman, Phillip R. Bennett, freezing the assets obtained from his Refco stock sales in the Company's August 2005 Initial Public Offering ("IPO").
The TRO, resulting from a motion filed by Wechsler Harwood and its co-counsel Scott+Scott LLC, as well as court proceedings held in the FrontPoint Action, was issued by United States District Judge Denny Chin for the Southern District of New York. The TRO prohibits Bennett from dissipating his IPO proceeds (approximately $111 million) pending a Preliminary Injunction hearing currently scheduled for December 1, 2005. At that time, the Court will determine whether or not a more permanent restraining order should issue pending a full trial on the merits.
The FrontPoint Action, one of the very first filed against Refco, Bennett and others, alleges defendants violated the federal securities laws by failing to disclose the related-party loan of $430 million to an entity controlled by Bennett. The Registration Statement and Prospectus, prepared in connection with the IPO, failed to disclose Bennett's fraudulent transaction. As a result, some 26.5 million shares of Refco's common stock were sold to the unsuspecting public. On October 12, the U.S. Attorney's Office in New York announced that it had filed securities fraud charges against Bennett for his part in hiding hundreds of millions of dollars from investors who bought stock in Refco's IPO.
If you purchased Refco securities between August 11, 2005, and October 18, 2005, inclusive (the "Class Period"), you are considered a putative Class member. As a member of the Class, you may, not later than December 12, 2005, move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Please note, however, your ability to share in any recovery is not affected by the decision whether or not to serve as a lead plaintiff. You may retain Wechsler Harwood, or other counsel of your choice, to serve as your counsel in this action.
Wechsler Harwood represents a number of injured Refco shareholders and institutions and has taken a leading role in many other important actions on behalf of defrauded shareholders -- recovering hundreds of millions of dollars in the process. The Wechsler Harwood website (www.whesq.com) has more information about the firm and detailed information regarding this matter. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following:
Wechsler Harwood LLP Jeffrey M. Norton, Esq. (jmn@whesq.com) 488 Madison Avenue, 8th Floor New York, New York 10022 Toll Free Telephone: (877) 935-7400
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca.