Tom Kirkindall from of Houston's Clear Thinkers has taken the time to explain it to himself and given us the benefit of listening in via his fine blog. So here goes:

Despite the superficial allure of criminal charges against crafty businessmen, I remain skeptical of criminal cases against anyone until I truly understand them, and the post-Enron era of the government playing to the public's resentment of wealthy business executives has only reinfored my skepticism. So, I continue to look for a coherent explanation of the details behind the government's above-described theory of the case against Mr. Bennett...so let's break this down:

RGHI owes money to Refco;

Refco makes loan 1 to the hedge fund;

Then, hedge fund makes loan 2 to RGHI;

Refco then makes loan 3 to RGHI;

RGHI uses the proceeds from loan 3 to pay the hedge fund for loan 2; and

Then the hedge fund uses the proceeds from the loan 2 repayment to repay loan 1 to Refco.

And indictments ensue... Did'ja get all that? Neither did Tom, who apparently remains a bit skeptical on exactly where the fraud lies. Check out his full post for a bit of a different perspective on the Refco mess.

And while you're there mourn for his struggling 'Stros who don't quite look like they're going to cut the mustard in this year's World Series.

-- MDT

Labels: Enron, Refco