Jefferies sued by investors over losses tied to First Brands collapse

Core Viewpoint - Jefferies Financial Group is facing a lawsuit from investors alleging fraud related to investments in a fund linked to the now-bankrupt auto parts supplier First Brands [1][2]. Group 1: Lawsuit Details - The lawsuit was filed in a New York state court, claiming that Jefferies and its Point Bonita Capital trade finance fund misrepresented their control over receivables purchased from First Brands, which was involved in a multibillion-dollar fraud [2]. - Plaintiffs, Eugenia II and Eugenia III Investment Holdings, invested $25 million in Point Bonita and claim they were misled about the management of their funds, which were allegedly double-pledged and manipulated [3]. - The investors are seeking at least $18.4 million, which represents the difference between their current investment value and potential earnings from alternative investments [4]. Group 2: Jefferies' Response - A spokesperson for Jefferies stated that the firm did not engage in fraud and plans to vigorously defend against the claims, expressing confidence in prevailing on the merits of the case [4]. - Jefferies reported that its Leucadia Asset Management unit, through Point Bonita, held approximately $715 million in receivables linked to First Brands, and Leucadia is also named as a defendant in the lawsuit [4]. Group 3: Background on First Brands - First Brands' founder and a former executive were indicted on fraud and conspiracy charges related to the company's collapse, with both pleading not guilty [5].