By Gokhan Ergocun
ISTANBUL (AA) - Jefferies Financial Group, a US-based investment bank, said Friday that it believes it was "defrauded" by First Brands Group, an automotive parts manufacturer that has filed for bankruptcy.
The CEO of Jefferies, Rich Handler, said Friday that the bank did not yet know exactly what had happened at First Brands, but details would become clearer as the bankruptcy process progresses.
"I'll just say this is us personally, we believe we were defrauded," Handler said.
He said one of the rival companies had experienced a similar situation, but he did not believe it was a systemic issue.
Handler noted that such events in the financial sector usually serve as early warnings, but it was not the case in the current situation.
First Brands filed for bankruptcy protection Sept. 29 due to creditor concerns about the company’s use of opaque off-balance sheet financing.
Shares of Jefferies, which reported being at risk due to loans it had extended to First Brands Group, lost more than 10% of their value on Thursday.