Ex-Refco President Sentenced to 10 Years in Prison

Tone Grant, the former president of Refco, once the largest independent commodities broker, was sentenced to 10 years in prison for his role in a $2.4 billion fraud that involved hiding huge trading losses from clients.

His sentence was handed down by U.S. District Judge Naomi Buchwald in Manhattan at a hearing Thursday.

Grant, 64, was the lone top executive at Refco to face trial. His former colleague, ex-chief executive Phillip Bennett, pleaded guilty in February to 20 criminal counts a month before he was due to go to trial. Bennett was sentenced last month to 16 years in prison.

Prosecutors contend that Grant stood at Bennett's side in carrying out a massive fraud in an effort to lie about Refco's financial health. Their motive was to keep the firm afloat in the hopes of one day selling it for a big profit, the government argued.

Refco unraveled in 2005, shortly after it became a public company, after revealing that Bennett had hidden $430 million in bad customer debt. Refco stock plummeted and the company filed for bankruptcy.

Grant was convicted at trial of five criminal counts — conspiracy, securities fraud, wire fraud, bank fraud and money laundering. His lawyers have argued that, even if the government's evidence were to be accepted, that evidence shows Grant only played a relatively minor role in comparison to Bennett.

"Mr. Grant continues to maintain his innocence," Roger Zuckerman, one of his attorneys, said after the sentencing. "We look forward to the appeal."

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