Dec. 4 (Bloomberg) -- Refco Inc.’s former lawyer Joseph Collins, already under indictment for helping the futures brokerage hide more than $1 billion in bad debts from lenders and investors, faces new bank fraud charges.

The indictment accuses Collins, then a partner in Mayer Brown’s Chicago office, of helping Refco’s management conceal from lenders the existence of “round-trip loan transactions” that hid $2 billion in guarantees given by the New York-based firm.

It was “all in an effort to secure lines of credit totaling more than $1 billion,” Acting U.S. Attorney Lev Dassin said today in a statement.

The Refco case has led to prison terms for former Chief Executive Officer Phillip Bennett, who is serving a 16-year sentence after pleading guilty, and his ex-partner, Tone Grant, serving 10 years following a conviction at a trial.

Collins’ lawyer, William Schwartz, didn’t immediately return a call. He previously said that Collins was “an innocent victim of the Refco fraud.”

The new indictment, like the old one, says Collins drafted documents for transactions that hid loans and public filings Refco used in attracting $2.4 billion from banks and investors before the company went bankrupt in 2005.

Each bank fraud count carries a maximum penalty of 30 years in prison.

Once the biggest independent U.S. futures trader, Refco collapsed in 2005 two months after raising $670 million in an initial public offering. Refco Inc., as it was known after the IPO, filed one of the biggest bankruptcies in U.S. history after disclosing that a firm owned by Bennett owed the company hundreds of millions of dollars.

The case is U.S. v. Collins, 07-cr-1170, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: David Glovin in New York federal court at dglovin@bloomberg.net;

Last Updated: December 4, 2008 18:12 EST