Refco boss facing Austrian arrest

Authorities in Austria have issued an arrest warrant for Phillip Bennett, former head of US brokerage Refco.

The move came a day after prosecutors began an inquiry into fraud and related charges surrounding Mr Bennett.

A warrant was also put out for the son of the former head of Bank Fuer Arbeit und Wirtschaft (Bawag), Wolfgang Floettl Jnr.

He is alleged to have carried out speculative dealings, sparking Bawag losses of almost 1bn euros (£690m).

On Friday, the bank said it had concealed the losses, made during the 1990s as a result of making bad loans to funds run by Mr Floettl.

The loans were made to companies mainly engaged in interest rate and currency transactions in the Caribbean.

The bank said it had chosen to write down the losses over time, rather than in a single year, amid fears that such a large loss would rattle consumer faith in the bank.

Bawag officials have maintained that the bank is financially sound, but the revelations come just months after the revelations that it lent more than $400m to the former head of Refco.