MF Global Bankruptcy: Resources for Kansans
MF Global Bankruptcy: Resources for Kansans
March 28, 2012 Update - Financial Services Committee to Investigate Emails
The House Financial Services Committee's Oversight and Investigations Subcommittee will hold a hearing in which members will seek information regarding the events leading up to the collapse of MF Global. The Subcommittee is likely to ask questions of panelists about emails exchanged regarding transfers of funds.
- Oversight and Investigations Subcommittee Hearing on "The Collapse of MF Global, Part 3"
- "Corzine faces potential lawsuits if he knew MF Global customer money might be transfered," Boomberg News, March 26, 2012
March 1, 2012 Update - Many Questions Still Unanswered
Congressman Huelskamp questioned Chairman Gary Gensler of the Commodities and Futures Trading Commission at a hearing with the Agriculture Committee on Wednesday, February 29. He asked the chairman to recall events leading up to the day MF Global collapsed on October 31, 2011, as well as the conversation he had with officials of MF Global at 2:30 that morning. Watch the video of the questioning here.
Congressman Huelskamp statement:
"It is apparent there are many missing answers about what happened to the money of MF Global customers. The longer questions remain unanswered, the longer customers go without being made whole. I look forward to Chairman Gensler's prompt recollection of the explanation he was given of the firm's problems before MF Global finally collapsed."
January 26, 2012 Update - Clients Still Not Made Whole
According to a January 12, 2012 article from Bloomberg, “MF Global Inc. has distributed about $3.8 billion so far and has about $1.5 billion under its control, while there’s still $1.2 billion missing.” The distributed amount represents about 72% of customer accounts. However, not only are customer funds missing, but apparently JP Morgan is a creditor and is owed approximately $1.2 billion. We expect the courts will have to settle the matter as to whether customers or corporations will receive funds if and when they become available.
The previous update includes information about the House Agriculture Committee hearing in which Jon Corzine was subpoenaed to testify. Subsequently, he testified before the Senate Agriculture Committee and the House Financial Services Committee.
As a member of the House Agriculture Committee and a representative of many constituents affected by MF Global’s collapse, I am committed to seeing that the Committee exercises its oversight functions to investigate what happened under Jon Corzine’s watch.
Claims are due January 31, 2012. Learn more here.
December 8, 2011 Update - Agriculture Committee questions former MF Global CEO Jon Corzine
On Thursday, December 8, 2011 the House Committee on Agriculture, on which Congressman Huelskamp sits, held a public hearing to examine the bankruptcy at MF Global and the disappearance of $1.2 billion of customer funds.
Congressman Huelskamp was recognized for five minutes to question Corzine on his role in the bankruptcy at MF Global and the location of the missing funds.
Read Congressman Huelskamp's statement on the hearing here.
December 2, 2011 Update - Agriculture Committee to Subpoena Jon Corzine, former CEO of MF Global
The Committee on Agriculture, on which Congressman Huelskamp sits, announced on December 2 that it will subpoena Jon Corzine, former CEO of MF Global, to testify before a full committee hearing on December 8.
Read more about the decision to subpoena here.
Constituents who would like to propose questions for Congressman Huelskamp to ask Mr. Corzine should contact the Washington, D.C. office at 202-225-2715.
November 17, 2011 Statement from Congressman Tim Huelskamp:
“Throughout the past two weeks I have heard from several Kansans who are on the receiving end of MF Global’s flagrant disregard for the law and mismanagement,” Congressman Huelskamp said. “The apparent comingling of funds has wreaked havoc for many customers. For the sake of those who have fallen victim to this financial wrongdoing, it is my hope that CFTC and the courts will not rest until the missing funds are restored to customers as soon as possible. And, It is my hope that they will not rest until all involved parties are prosecuted to the fullest extent of the law possible if and when violations are found.”
“I will continue to monitor the situation, put pressure on the judge and CFTC to investigate and move with all possible speed, and will support the ongoing investigations. I will work to keep my website updated with the latest information regarding MF Global, the bankruptcy court, and what it means for Kansans. I urge constituents: Do not hesitate to contact my office with any questions you may have.”
What Happened?
MF Global Holdings Ltd., run by former New Jersey Governor Jon Corzine, filed for bankruptcy (the eighth-largest in history) on October 31, 2011. Shortly thereafter it was discovered that hundreds of millions of dollars were missing. News reports indicate that the firm pursued bankruptcy following risky investments in the European bond market that led to major losses and downgrades. MF Global tried to avert bankruptcy by finding another firm to acquire it, but potential knowledge of the customer fund shortfall may have discouraged such acquisition.
Commodity customers’ monies were supposed to be kept in segregated accounts, but there is speculation from the CME Group that MF Global broke rules and did not keep such funds in a different account from its futures trading account. The Commodity Futures Trading Commission (CFTC) is now investigating along with the Securities and Exchange Commission (SEC) and the Federal Bureau of Investigation (FBI) the “disappearance” of these funds. Specifically, CFTC is investigating possible violations of the Commodity Exchange Act that prohibit mixing of such funds (see statement from Commissioner Scott D. O’Malia). This law also requires entities like MF Global to have enough money in its accounts to cover customer liabilities (see letter from Kansas City Board of Trade to members).
The missing $633 million represents approximately 12 percent of the segregated funds; the remaining 88 percent have been accounted for.
A trustee has been appointed to oversee and recommend to a bankruptcy judge how funds will be paid out to customers. It is expected that a bankruptcy judge will hear the request of the trustee charged with overseeing these accounts to release slightly more than $500 million of the more than $600 million missing funds.
UPDATE: It is now estimated that as much as $1.2 billion may be missing.
Contact Information for Investors with Questions (As provided by CFTC)
- 1-888-236-0808 (U.S. callers)
- 1-503-597-5173 (international callers)
- This e-mail address is being protected from spambots. You need JavaScript enabled to view it
Resources
These links are provided for informational purposes only. We do not represent, guarantee or warrant the accuracy, completeness, currency or suitability of information provided via these outside websites for any purpose.
- Commodity Futures Trading Commission (CFTC) Resource Page Concerning MF Global
- MF Global Trustee Resource Page
- CME Group Resource Page