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In SpongeBob we trust? Defrauded investors of Peregrine Financial Group may have no choice but to trust SpongeBob as they now work at recovering the millions they may have lost.
Peregrine's CEO, Russell Wasendorf, confessed to nearly 20 years of fraud while at the helm of the futures brokerage, reports Reuters. His house of cards fell apart this month and his company declared bankruptcy.
Wasendorf was arrested and an investigation of Peregrine's assets revealed a trove of silver SpongeBob SquarePants coins in company vaults. The FBI seized the coins, and investors facing a $200 million shortfall may have no choice but to accept compensation by SpongeBob.
Earlier this month, Wasendorf admitted to doctoring bank statements to make regulators think that his company had more assets than it did, reports Reuters. The lie eventually became too big and his brokerage ended up owing investors about $200 million, while having only $24 million in liquid assets, reports Reuters.
As prosecutors prepare their fraud case Wasendorf, it's interesting to learn the other businesses Peregrine were involved in. For example, along with futures contracts, the financial outfit was reportedly also involved in the minting of novelty coins in precious metals.
Through a unit called PFG Precious Metals Inc, the company offered investors "whole sale prices" for novelty gold, silver and platinum coins, including the SpongeBob SquarePants coins seized by the FBI. A four-coin set of SpongeBob Squarepants, is reportedly worth $259.
Perhaps investors should have had red flags about placing their money at Peregrine when they were approached to purchase SpongeBob SquarePants coins. Those who didn't heed the warnings may now be repaid by SpongeBob.