(Bloomberg) ? Refco Inc., the bankrupt trader, operated in ?chaos? as customers sought to retrieve funds in the days after the company?s former chief executive officer Phillip Bennett disclosed he had hid $430 million in debt, an executive testified.

Customers withdrew roughly $600 million from accounts after Bennett in October revealed he had hid the debt and the company said its financial statements couldn?t be relied on, Thomas Yorke, an executive vice president of Refco?s Refco Securities unit, said at a hearing in US Bankruptcy Court in New York.

?The customer calls kept coming in with questions and demands,? Yorke said during the fifth day of hearings on a request by customers to liquidate Refco?s Refco Capital Markets unit.

?It was like nothing we?d ever seen before.

?I would describe it as chaos.?

Customers contacted the New York-based company to retrieve cash and securities held in accounts at Refco subsidiaries, including Refco Capital.

The company eventually placed a moratorium on withdrawals and said Refco Capital owes customers $4.2 billion along with an almost $2 billion shortfall.

Refco filed for bankruptcy protection one week after Bennett?s disclosure. Bennett pleaded not guilty to federal fraud charges in November.

?There was definitely an increase? in demands, Yorke said during his third day of testimony as a witness for Refco.

?You couldn?t hang up the phone without having somebody leaving you with something they needed or wanted as a result of that phone call.?

Customers owed $1.7 billion have asked US Bankruptcy Judge Robert Drain to liquidate Refco Capital immediately to allow them to recover what remains in their accounts. The customer group has said Refco Capital sold or loaned some of its cash and securities without its consent.

Parent Refco, a committee representing unsecured creditors and a second customer group owed about $2 billion oppose the request.

Drain is scheduled to rule later this month.

Refco Capital, its parent and 22 affiliates filed the 15th- biggest bankruptcy in US history on October 17, with creditors owed $16.8 billion.

Refco shares fell 6 cents to 45 cents in over-the-counter trading.

The company?s 9 percent notes maturing in 2012 fell .50 cents to 56.25 cents on the dollar, according to Trace, the bond-price reporting system of the NASD.