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Where is MF Global Money?

This U/Ill paper explains what happens when a commodity trader like MF Global goes bankrupt and speculates on how much moeny is left to pay accounts and how that would happen.

http://www.farmdocdaily.illinois.edu/2012/01/customer_accounts_and_the_mf_g.html

 

Here's the conclusion but you need to read the rest of the 1 page document to see how it all works.

 

"Will former MF Global customers ever see the remaining 28% of their funds? The answer to this question depends in large part on whether the bankruptcy trustee and others are successful in recovering the missing $1.2 billion in customer funds. It also depends on whether the proceeds from the liquidation of any other MF Global assets (mostly cash and securities, estimated by the trustee at $290 million) are applied to the shortfall in customer funds, or instead used to pay other creditors. In a January 18 filing to the bankruptcy court, the CFTC argued that commodity customers must be made whole, even if this requires others to be sent away empty-handed. This and other issues likely will be resolved in the courts, so it may be many months before the final outcome is known." 

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3 Replies

Re: Where is MF Global Money?

Thanks for putting that up Jim.

 

From what I can gather from this it seems to matter which Chapter is applied:

 

http://jessescrossroadscafe.blogspot.com/2012/01/nasty-business-of-mf-global-bankruptcy.html

 

 

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kraft-t
Senior Advisor

Re: Where is MF Global Money?

I'm doubtful that MF global is covered with Fdic insurance. A bankrupsy judge may claw back some of the money, but I suspect that secured creditors will come before depositors.

 

I think there will be lots of farmers specs & hedgers SOL!

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Re: Where is MF Global Money?

Makes one wonder how safe are the 401K's and IRAs and some of the pensions. Will they try and steal those too???

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