NEW YORK (Bloomberg) ? Refco Inc., the broker that filed for bankruptcy after disclosing $430 million in hidden debt, should be run by a court-appointed trustee to ensure creditors are protected, a Department of Justice official said.

Refco?s creditors may have claims against management for decisions that led to the broker?s October 17 bankruptcy filing, Deirdre Martini, the US Trustee for the US Bankruptcy Court in New York, said yesterday in court papers. A court-appointed trustee needs to take control of the company to alleviate any conflicts of interest, Martini said.

The company supports the appointment of a trustee. The New York-based broker?s committee of unsecured creditors opposes the move, arguing it should be entrusted to pursue claims against company officials on behalf of creditors for the remainder of the bankruptcy case. Refco no longer conducts business and is selling assets to raise money for creditors owed $16 billion.

Refco filed for bankruptcy one week after disclosing that its former chief executive officer Phillip Bennett hid the debt off the books and that the company?s financial records could not be relied upon. Bennett pleaded not guilty to fraud charges in November. He?s still on the company?s board.

The company appointed financial consultant Harrison Goldin as chief executive in December. Goldin, the former comptroller of New York City, advised Enron Corp. on its bankruptcy case.

?Both the committee and Mr. Goldin have the ability and wherewithal to conduct an appropriate investigation,? creditor lawyer Luc Despins said in court papers.

US Bankruptcy Judge Robert Drain will consider the issue at a hearing today.