MF Global starts final repayments of 100% of customer claims

The defunct brokerage once led by Jon Corzine will begin distributions to satisfy $6.7 billion in claims

Apr 3, 2014 @ 11:55 am

MF Global Inc., the defunct brokerage once led by former New Jersey Sen. Jon Corzine, will begin final distributions to satisfy $6.7 billion in claims from former customers, starting tomorrow and lasting several weeks, the trustee overseeing the repayments said.

“Checks are going in the mail that will make all public customers of MF Global Inc. 100 percent whole,” the trustee, James Giddens, said in a statement Thursday. He called the repayment in full, which he had predicted since November, the result of “Herculean efforts” by many professionals in the case. It will satisfy claims of more than 26,000 securities and commodities customers.

MF Global Holdings Ltd., the brokerage's parent company, filed for bankruptcy on Oct. 31, 2011, after a wrong-way $6.3 billion bet on bonds of some of Europe's most indebted nations. More than $1.6 billion in customer funds that should have been segregated were missing. The company listed assets of $41 billion and debts of $39.7 billion.

“The 100% customer recovery does not diminish the consequences of the unprecedented customer property segregation failure that led to MFGI's liquidation, including the length of time customers have been without their property,” Mr. Giddens said in Thursday's statement.

Interim distributions have been made to customers. The final distribution was made possible by a temporary loan from the general estate of the parent company's bankruptcy and decisions by U.S. Bankruptcy Judge Martin Glenn and U.S. District Judge Victor Marrero to reject objections by ex- managers including Mr. Corzine, the former MF Global chairman and chief executive officer.

Mr. Corzine, who served as New Jersey governor and Goldman Sachs Group Inc. co-chairman, in November challenged a bankruptcy court ruling that would advance funds from the bankruptcy estate of the parent company to pay brokerage customers' claims. Other ex-MF Global managers who had been accused of wrongdoing in a lawsuit along with Mr. Corzine, including Bradley Abelow and Henri Steenkamp, joined him in the appeal.

(Bloomberg News)


What do you think?

View comments

Recommended for you

Sponsored financial news

Featured video


Top questions surrounding future of DOL fiduciary rule

Reporter Greg Iacurci and managing editor Christina Nelson discuss the biggest uncertainties springing from the Fifth Circuit Court of Appeals' decision to vacate the regulation.

Latest news & opinion

What the next market downturn means for small RIAs

Firms that have enjoyed AUM growth because of the runup in stocks may find it hard to adjust to declining revenues if the market suffers a major correction.

DOL fiduciary rule likely to live on despite appeals court loss

Future developments will hinge on whether the Labor Department continues the fight to remake the regulation its own way.

DOL fiduciary rule: Industry reacts to Fifth Circuit ruling

Groups on both sides of the fiduciary debate had plenty to say.

Fifth Circuit Court of Appeals vacates DOL fiduciary rule

In split decision, judges say agency exceeded authority.

UBS, after dumping the broker protocol, continues to see brokers come and go

The wirehouse has seen 14 individuals or teams leave and five join for a net loss of $2.4 billion in AUM


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print