Business

Jun 5, 2013 5:00 PM by Juice Godfrey

Gov't accuses US Bank of illegally handling funds

WASHINGTON (AP) - The Commodity Futures Trading Commission filed a civil lawsuit Wednesday against U.S. Bank, accusing the bank of illegally handling customer funds from a failed brokerage firm.

U.S. Bank held funds of the collapsed Peregrine Financial Group, whose owner has been convicted of stealing $215 million from the customers.

The federal regulator said the Minneapolis-based bank, among other things, knowingly aided Peregrine owner and CEO Russell Wasendorf Sr.'s transfer of millions of dollars to pay for his private jet and restaurant.

U.S. Bank said in a statement that it did nothing wrong "and will defend itself vigorously."

Iowa-based Peregrine filed bankruptcy last July. The CFTC filed civil fraud charges against the firm and Wasendorf. He was convicted on criminal charges and sentenced to 50 years in prison.

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