MF Global

MF Global sacked all their personnel! It is a shame another big name is history now. It would be great if the other big guys take note of that. I don't know why people tend to repeat the same mistakes. ...not a very smart approach, indeed.

Seeing FXCM in the thread of MF Global just reminded me of Refco - the rescue team

Cheers

Foreign-exchange clients of MF Global Canada Co. will get their money at the end of this month after having been excluded from an earlier agreement, said the trustee for the bankrupt brokerage.

“The Trustee will be making an application to court on Thursday Nov. 24 to obtain an order requiring the payment by cheque of all MF Global Canada Co. foreign-exchange accounts by Nov. 30,” KPMG said Friday in an e-mail.

Hi Peter,

I just popped in to FF to see how the Explorer is working these days, only to discover my ears were burning! Thanks for the link Peter.

I'm not sure if the powers that be here at FF permit such things, but nothing ventured nothing gained, so here's my most recent thoughts on the MF Global fiasco:

The CFTC Finally Realize That MF Global "Has Shaken Public Confidence"!

@PIN Trader - MF Global were a futures broker! What makes you so sure futures is safer than FX? The CFTC and CME are currently running around in ever decreasing circles trying to persuade people that trading futures is still "safe", whereas the sad demise of MF Global seems to prove exactly the opposite. When the "Masters of the Universe" are in charge, the evidence strongly suggests that nothing is safe!

Cheers,

Jim

"We can't find the money over here so we'll look over there..."

Oops there's even less money than we thought over there.

Regulation is only as good as the promise it's built upon. Putting regulaion on top of broken promises is like the boy who cried "WOLF".


More money missing (link)

More than $1.2 billion, that's amazing and I believe we will see in the next few weeks, the value will become more than $2.0 billion.

Well, I'm start wondering how much their "real" net asset value after re-evaluation.

cheers

Actually they were a futures, fx and spread betting broker here in the UK. But you are right, the industry is corrupt to the core and if you have money above the compensation limit with any broker you should be concerned. What's to stop the same thing happening again, nothing.

I should point out that I was not referring to safety of funds in this post, I was referring to things like abusive and fraudulent slippage practices which are much more prevalent in FX (as proven by the Gain Capital and FXCM fines).

But yes of course if you have a futures account that doesnt stop your broker stealing the money just as easily as from an FX account.

Hi PIN Trader,

I didn't mean to imply they were ONLY a futures broker. Perhaps I should have tagged the word "too" on to that sentence?


The evidence does rather suggest your analysis is correct. At the very least it's an extremely convincing argument for spreading your eggs across several baskets, whether you trade futures, FX or both. Maybe it's even a convincing argument for giving up trading and taking up knitting instead?

Cheers,

Jim

Link to article:

http://www.reuters.com/article/2011/...bankruptcyNews

MF Global customers get hope; Corzine asked to testify

Tue Nov 22, 2011 9:56pm EST

* Assets secured from Harris Bank; CME expands guarantee

* Corzine asked to testify before Congress on Dec. 15

* Judge OKs naming bankruptcy trustee for entire company

* Trustee sees $1.2 bln shortfall; CME says it's much less

By Nick Brown, Christopher Doering and Jonathan Stempel

Nov 22 (Reuters) - Former customers of MF Global Holdings Ltd got some good news on Tuesday, as the bankruptcy trustee secured more assets and the CME Group Inc expanded a guarantee to speed the return of frozen funds.

Meanwhile, Jon Corzine, who has been publicly silent since resigning as MF Global's chief executive on Nov. 4, was asked to appear before Congress next month to explain how his futures brokerage, among the largest in the United States, collapsed into bankruptcy so fast.

Also on Tuesday U.S. Bankruptcy Judge Martin Glenn at a hearing in Manhattan approved the appointment of a bankruptcy trustee to oversee what remains of MF Global, wresting control from the remnants of its management team.

James Giddens, the trustee liquidating MF Global's broker-dealer unit, said he expects to soon recover $1.3 billion of assets from Bank of Montreal's Harris Bank unit, but these funds are not those missing from customer accounts.

Giddens still estimates the shortfall in customers' accounts at $1.2 billion - a figure the CME said on Tuesday was an overestimate. Giddens said the funds from Chicago-based Harris Bank will go toward repaying some customers who had feared the loss of more than 20 percent of their accounts.

CME, which was MF Global's first-line regulator, more than doubled the size of a fund to help expedite the return of client cash to $550 million from $250 million.

The Chicago exchange operator, which initially estimated the shortfall to be about $600 million, also said it is confident that recent reports of a more than $1 billion shortfall are "incorrect."

"With CME, we want to say in one word, 'finally!'" said John Roe, a spokesman for the Commodity Customer Coalition, which represents more than 7,000 former MF Global customers. "If they had done it on Oct 31, things would not have locked up."

MF Global filed for Chapter 11 protection on Oct. 31 after the New York-based company revealed it had made a $6.3 billion bet on European sovereign debt.

The revelation worried investors, credit rating agencies and trading partners, and resulted in a liquidity crunch.

James Kobak, a lawyer for Giddens, stood by the trustee's shortfall estimate at the hearing. "The apparent shortfall could go up. We hope it could go down as well. But that was the best information at the time."

NEW CASH

The $1.3 billion of cash, securities and foreign currencies recovered from Harris would be pooled with $3.7 billion of other assets already under Giddens' control -- all segregated accounts in U.S. depositories -- for eventual distribution to customers, spokesman Kent Jarrell said.

The combined $5 billion total would be close to CME's initial $5.45 billion estimate for all MF Global segregated funds requirements, in theory leaving customers out less than 10 percent of what they might otherwise expect to recover. A $520 million disbursement from those funds is underway now.

Jarrell disputed the CME estimate for the amount of customer funds at MF. "We don't know whether that's the (final) number," he said. "We'll see what it is when this is all over and we've fully reconciled customer claims."

The CME's increased guarantee was aimed at quelling criticism that it has done too little to help customers with billions of dollars of cash stuck in MF Global accounts.

"The protection of our customers and the integrity of all futures markets continue to be our two chief concerns," CME Chief Executive Craig Donohue said in a statement.

CME said its $550 million guarantee would allow a return of $4 billion of the $5.5 billion meant to be held in segregated accounts, including all $2.5 billion at CME Clearing.

Experts have said customers should be first in line to recover funds from the bankruptcy, even if the missing customer cash is not discovered.

TRUSTEE TO PROVIDE OVERSIGHT

MF Global and JPMorgan Chase & Co , one of the company's main lenders, had asked Glenn to authorize the appointment of a trustee for the parent company. No one has yet been named to the role.

In approving the request, Glenn also authorized JPMorgan to pledge $26 million of collateral, up from $8 million, to keep MF Global operating in bankruptcy.

A trustee is often named to serve the bankruptcy estate's best interest, or when company executives are suspected of wrongdoing. Corzine, a former New Jersey governor and chief of Goldman Sachs & Co , has not been accused of wrongdoing.

Bradley Abelow, MF Global's chief operating officer, was also asked to testify on Dec. 15 before the House Financial Services Subcommittee for Oversight and Investigations, along with Corzine and several top U.S. regulators.

Lawyers for Corzine and Abelow were not immediately available for comment.

Others invited to testify were Robert Cook, director of the U.S. Securities and Exchange Commission's division of trading and markets; Gary Gensler, who heads the Commodity Futures Trading Commission; and William Dudley, president of the Federal Reserve Bank of New York.

Gensler and SEC Chairman Mary Schapiro are also slated to appear on Dec. 1 before the Senate Agriculture Committee, which oversees the CFTC.

Regulators are trying to determine what happened to the missing money, and whether MF Global may have mixed customer funds with its own, a major violation of industry rules. Federal prosecutors are also looking into the matter.

CUSTOMERS OBJECT

At Tuesday's hearing, Glenn approved the adoption of a parallel claims process for securities customers and commodities customers of the broker-dealer, MF Global Inc.

He declined to approve the creation of an official committee of commodities customers, but urged Giddens to keep those customers in the loop. "If there's 38,000 separate voices, they're going to drown each other out," Glenn said.

The judge also advised Giddens to make it a priority to focus on small claims "from people who are really suffering."

JPMorgan is also expected to soon announce it will pay 25 million pounds (US$39.1 million) for MF Global's 4.7 percent stake in the London Metal Exchange, making it that exchange's largest shareholder, two people familiar with the matter said.

An announcement could come this week. JPMorgan already has a 6.2 percent stake in the exchange. A sale could leave more money for MF Global creditors.

Corzine testifying live:

http://www.c-span.org/Events/Fmr-Sen...10737426111-1/

somehow the futures traders accounts are always made whole by the big boys...its the stocks and spot guys who are left wailing and gnashing their teeth.

Link:
http://www.reuters.com/article/2011/...7BD20L20111214

Regulators know where MF Global funds went

By Christopher Doering

WASHINGTON | Wed Dec 14, 2011 6:52pm EST

(Reuters) - Regulators now have a more complete picture of money transfers in the final days of bankrupt brokerage MF Global, but must sort out which transactions were legitimate before more money can be released to customers, a top official told Reuters on Wednesday.

Jill Sommers, who is heading the Commodity Futures Trading Commission's review of MF Global, said regulators "are far enough along the trail" that they know where the money went.

"Now it's just finding out which ones of those transactions are legitimate and which ones of them are illegitimate," Sommers said.

The CFTC and the trustee liquidating the firm are under intense pressure from lawmakers and customers to provide answers about what happened to hundreds of millions of dollars in customer money that went missing as the firm collapsed.
MF Global officials, including former Chief Executive Jon Corzine, have told lawmakers they simply do not know where the money is, and deny authorizing any misuse of customer money.

"We certainly don't want to lead anyone to believe we don't know what happened. We do know, and we see where all the transactions went," said Sommers, a Republican commissioner, in an interview on Wednesday.

She declined to reveal details on the fund transfers until investigators have determined the purpose of all the transactions. Sommers could not estimate when regulators will complete their investigation, but said "really good progress" is being made.

Fellow CFTC Commissioner Bart Chilton, a Democrat, tempered expectations. Chilton said in a statement after Sommers' remarks were published that a thorough accounting of all customer funds remains a work in progress.

"Based upon the most up-to-date information available, I do not have confidence that we know where all the money went," Chilton said.

MF Global filed for bankruptcy on October 31 after it was forced to reveal that it had made a $6.3 billion bet on European sovereign debt, spooking investors and customers.

The ensuing search for missing money has sent reverberations through the farm belt and trading floors, and has attracted the attention of the FBI and federal prosecutors.

A trustee liquidating the firm has estimated the shortfall could be as high as $1.2 billion.

LEGITIMATE VS. ILLEGITIMATE

Sommers said on Wednesday that just because money was transferred out of a customer account to the broker-dealer account "doesn't mean it was illegitimate."
Under certain circumstances, brokerages are allowed to take customer funds and invest them in a range of approved securities.

However, in exchange for using the cash, firms are required to back it up with high-quality collateral such as U.S. government securities.

CME Group, MF Global's front-line regulator, has stated plainly that the firm misused customer funds as it faced a liquidity crisis.

At a Senate Agriculture Committee hearing on Tuesday, CME Executive Chairman Terrence Duffy escalated the allegations, saying a CME auditor participated in a phone call during which an MF Global employee indicated that Corzine knew the firm used customer money to lend $175 million to its European affiliate.

Duffy said the matter had been turned over to the Justice Department, but he did not provide more details about the loan.

'DOWN TO THE PENNY'

Sommers said investigators are now trying to back up thousands of transactions with underlying documentation such as a signature or email to determine whether the customer approved the transfer into a broker-dealer account, a complicated process.

Until regulators can determine which transactions were illegitimate, they will not be able to determine the shortfall in customer funds, and how much money will ultimately be distributed back to customers, Sommers said.

A judge on December 9 approved an additional $2.2 billion transfer to MF Global's U.S. commodities customers, bringing the recovery to 72 percent of accounts.
"Until you actually know down to the penny which ones of those transactions were not legitimate transfers, you're not going to know whether or not you can claw back some of that money from other accounts," Sommers said.

"Until you know the exact shortfall, you're not going to know how much can then be distributed to customers above the 72 percent."

Pat Roberts, the ranking Republican on the Senate Agriculture Committee, said Sommers' revelation sets off the next chapter in the MF Global saga.

"Now the next step is to find out were (the transfers) legitimate or were they illegitimate, and then the big question is: who on Earth was responsible," he told Reuters Insider.

(Additional reporting by Nick Brown in New York; Editing by Karey Wutkowski and Tim Dobbyn)

bottom line..........

"we used your funds to gamble on markets..........and lost

all what we can offer to you now is..........our s-o-r-r-y

console youselves with this........."

And put more regulation in place... because we know regulation is what prevents this from happening in the first place. /sarcasm.

some day there'll be the need to put regulation on regulators then...........

(if things go this way)

Regulators? What regulators? What are they regulating? They must be regulating their graft payments. It's the scammers scamming the scammers. How else does 1.2 billion go missing? These guys make Jesse James look like a saint. They will get their wrists slapped and all will be forgotten. They will divide up the money later and retire in luxury. If this happened in China they would all go missing.

capitalistic forex needs regulation of communist party then!

long live c o m m u-t a l i s m!

Got my cheque from KPMG .

I was being sarcastic that's why I put the /sarcasm switch on there. I guess that switch was too much for you to handle? LOL.

We'll see if we can teach a dog a new trick...

hi bluesteele, is it 100% of your fund ?