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JEFFERIES EXPANDS FURTHER IN SECURITIES FINANCE

Matthew Baldassano Joins To Co-Lead Firm's Securities Finance Effort

NEW YORK, May 7, 2007 -- Jefferies & Company, Inc., the principal operating subsidiary of Jefferies Group, Inc. (NYSE: JEF), today announced the hiring of Matthew A. Baldassano as Co-head of Securities Finance. An industry veteran, Mr. Baldassano has more than 20 years of experience in securities lending, as well as prime brokerage and structured products, at firms including Donaldson Lufkin & Jenrette and, most recently, Lehman Brothers.

Mr. Baldassano will be responsible for driving the continued growth and expansion of the Firm’s securities finance products. He joins fellow Co-head, Gene Vitagliano, who has been with Jefferies for over 17 years, and an established team of over 40 securities finance professionals in the New York area and London.

Jefferies’ securities finance team provides liquidity across a range of equity and equity-related products, including ADRs, GDRs, ETFs and convertible bonds. Jefferies’ broader Equity Financial Products effort includes derivatives, structured products, prime brokerage, securities finance, program trading and JETS (Jefferies Electronic Trading Solutions), a robust front end trading tool enabling access to proprietary algorithmic trading strategies.

“The addition of Matt Baldassano significantly enhances Jefferies' securities finance capabilities and complements the firm’s growing prime brokerage practice,” commented Richard B. Handler, Chairman and Chief Executive Officer of Jefferies. “We are committed to this important component of our Equity Financial Products offering and serving the lending and financing needs of our global clientele.”

Jason D. Griffith, Co-Head of Equities at Jefferies, said, “As the markets become increasingly global and lenders and borrowers continually seek increased supply, a strong securities finance practice is key. We are confident that Matt Baldassano’s tremendous experience, long-standing relationships and insight will add immediate value to our existing securities finance offering, so capably run by Gene Vitagliano.”

“I look forward to applying the knowledge and skills I’ve gained over the past two decades to support the continued build-out of Jefferies’ securities finance business and bring new opportunities to Jefferies clients,” added Mr. Baldassano. “Jefferies’ broad and innovative product offering and full-service equities platform were key factors in my decision to join the Firm."

A leader in equities for nearly 45 years, Jefferies has recruited significant additional sales, trading, capital markets, research, and technology professionals to its U.S. Equities department over the past 15 months, increasing the Firm’s headcount in this area to more than 650 people. Last year, the firm augmented its product offering considerably, adding derivatives capabilities and establishing a dedicated prime brokerage practice, as well as launching JETS. The derivatives team has quickly established its presence as a major player in listed equity options and, in its first year of operations, Jefferies’ Prime Brokerage is expanding rapidly and already serving over 50 hedge funds.

Prior to joining Jefferies, Mr. Baldassano spent six years with Lehman Brothers in the positions of Global Co-head of Securities Lending and Prime Brokerage Sales/Trading, and, most recently, Managing Director in Capital Markets Prime Services Origination. Previously, he was a Senior Vice President focused on US Equities Securities Lending and Structured Finance as a Product Manager in the Pershing Division at Donaldson Lufkin & Jenrette, where he worked for 14 years. He earned a BS degree in Finance and Economics from Fairleigh Dickinson University.

Mr. Baldassano will be based in the Firm’s New York City headquarters office.

About Jefferies

Jefferies, a global investment bank and institutional securities firm, has served growing and mid-sized companies and their investors for 45 years. Headquartered in New York, with more than 25 offices around the world, Jefferies provides clients with capital markets and financial advisory services, institutional brokerage, securities research and asset management. The firm is a leading provider of trade execution in equity, high yield, convertible and international securities for institutional investors and high net worth individuals. Jefferies & Company, Inc. is the principal operating subsidiary of Jefferies Group, Inc. (NYSE: JEF; www.jefferies.com).

For further information, please contact:
Tom Tarrant, Jefferies & Company, Inc., 203 708 5989, ttarrant@jefferies.com
Todd Miller, Cubitt Jacobs & Prosek, 203 378 1152, x149, tmiller@cjpcom.com