Officials from the Bermuda and London office of accounting firm KPMG have been named joint provisional liquidators of two unregulated Bermuda units owned by troubled commodities broker Refco Inc.

In a legal announcement on Friday, Michael W. Morrison, of KPMG Bermuda, and Richard Heis of KPMG LLP UK, were jointly appointed as the provisional liquidators for two of Refco?s five Bermuda units.

The appointments follow related applications being filed in October with the Bermuda Supreme Court. The applications, for Refco Capital Markets, Ltd. and Refco Global Finance Ltd., were made in tandem with Refco filing Chapter 11 bankruptcy protection proceedings in the US for 24 of its unregulated units.

Refco?s troubles followed the discovery on October 10 that former chief executive Phillip R. Bennett, who has now been fired by the company, hid a $430 million debt owed to Refco by a company he controlled.The monies were repaid the day of the discovery but Refco?s share price plummeted on news of the undisclosed, related-party transaction. The company has since been delisted from the New York Stock Exchange, and is trading on an over-the-counter exchange.

Bennett, who was arrested by US authorities in the days after his dismissal, is alleged to have broken securities laws by not disclosing that his company, Refco Group Holdings Inc., was the debtor, not an unrelated third party. He was due to appear in court yesterday as federal prosecutors pushed for a grand jury indictment. The court hearing has now been pushed to November 10, according to a Reuters report.

Refco?s main unregulated unit is based in Bermuda. Refco Capital Markets, Ltd., was shut down on October 13 because of a lack of liquidity. This unit provided prime-brokerage services to hedge funds.

It is alleged in court documents reviewed by that this unit was involved in a $335 million loan to Bennett?s company, through an intermediary company.

Santo Maggio, who was president of Refco Capital Markets until being suspended on October 10, was reported in earlier news reports to be cooperating with investigators.

Refco Inc. was last month delisted from the New York Stock Exchange because of the scandal. The company?s short life as a public company ? it was added to NYSE?s roster on August 11 ? is causing its own controversy, according to a Wall Street Journal report. Because Refco had not yet filed its first post-IPO quarterly result, neither Bennett nor the company?s chief financial officer had attested to the validity of the company?s financial position under Sarbanes-Oxley corporate governance regulations.

In the interim, the company?s regulated units have been targeted by a successive list of investors, in a bidding war where no one has yet to emerge a winner. An auction for these units is slated for November 9, after a first offer in the days after the company?s troubles came to light, fell apart.

The first bidder, a consortium of investors led by J.C. Flowers, stands to receive a reduced break-up fee of $5 million and $1 million in expenses if the regulated units go to another buyer.

Refco said in a statement posted on its website last week that there is also some interest in the company?s unregulated units. Creditors of those units are up in arms, according to the Wall Street Journal, because they say their trades were supposed to be done through the company?s regulated units, which would have protected their assets. Creditors of these units, now under Chapter 11 protection, are seeking in the region of $17 billion.

One of the leading creditors of Refco?s unregulated units is an Austrian bank, Bawag P.S.K. Group, that made a loan to Bennett to cover the undisclosed debt to Refco in the days before it was discovered and made public. Bawag was previously a minority owner of Refco but sold its stake more than a year ago.

It was the only creditor to be excluded from a committee formed to represent the common interests of those seeking their money.

Justice Department officials did not say why Bawag was not allowed to be part of that committee, according to the Wall Street Journal.

The first Refco company in Bermuda ? a predecessor to Refco Capital Markets, Ltd. ? was formed 15 years ago, according to records on file with the Registrar of Companies.

Three other Refco units incorporated on the Island are not known to be the subject of any legal actions surrounding Refco?s sale and global reorganisation of its units.

Law firms Conyers Dill & Pearman and Williams Barristers & Attorneys are acting in the Bermuda applications.