Peregrine: court OKs $41 million distribution to commodity customers

By Lisa Kerner

Charlotte, N.C., Dec. 18 - Peregrine Financial Group, Inc.'s Chapter 7 trustee was granted court approval to distribute up to $41 million of segregated cash to commodity customers holding allowed futures claims, according to a Wednesday filing with the U.S. Bankruptcy Court for the Northern District of Illinois.

As previously reported, Chapter 7 trustee Ira Bodenstein said he had $68.7 million on hand attributable to future customers in different account classes and was seeking court approval to transfer up to $41 million of that amount as an interim distribution.

Bodenstein said he plans to hold back more than $27.9 million of the available amount to ensure that adequate funds remain to account for any variations in claim amounts that may result from the claims allowance process.

The interim distributions would be made through claims agents.

Also, the court approved the trustee's request to make "catch-up" distributions to claimants that did not receive a first distribution in 2012 on account of their allowed futures claims. Those claimholders will receive an amount equal to the sum of the first distributions and the proposed interim distributions.

Peregrine's customers include customers with accounts opened to trade futures or options on futures on a U.S. futures exchange under section 4d of the Commodity Exchange Act and foreign futures customers with accounts opened to trade futures or options on an exchange located outside of the United States under CFTC Rule 30.7.

Under the proposed second interim distribution, the trustee will transfer 7% of 4d and delivery customers' account balances and 45% of 30.7 customers' account balances.

As with the first distributions, the trustee said he is proposing a higher interim distribution percentage for 30.7 customers because, as a separate account class, more funds are available in 30.7 customer segregated accounts as compared to 4d customer segregated accounts.

Peregrine is a Chicago-based futures broker. The company filed for bankruptcy on July 10, 2012. The Chapter 7 case number is 12-27488.

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