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Refco Fraud Victims to Recover $135 Million

MANHATTAN (CN) - More than $135 million in forfeited property traced to fraud committed by former Refco executives has been distributed to victims, in addition to the $437.5 million previously distributed, prosecutors announced Wednesday.

Refco executives had concealed hundreds of millions of dollars in trading losses and padded the company's revenues to achieve a fraudulent leveraged buyout in 2004 and an initial public offering in 2005.

Thomas H. Lee Partners paid $1.9 billion for a majority stake in Refco, which went bankrupt a year later when it was announced that CEO Phillip Bennett had covered up $430 million in debts from shareholders.

Prosecutors say they expect additional forfeitures will come through and more funds will be distributed to victims.

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