David Goldman for The New York TimesJon S. Corzine on the trading floor of MF Global last year.
The court-appointed trustee overseeing the liquidation of MF Global’s brokerage now estimates that the shortfall in the firm’s customer funds could be more than $1.2 billion, double previous estimates.
The trustee, James W. Giddens, said in a statement on Monday that his office was continuing to search for the missing funds, in conjunction with regulators and the Justice Department. He added that the numbers were preliminary and could change.
Mr. Giddens’s office did not elaborate on what might have happened to the money, though investigators have been focusing on the possibility that MF Global improperly used customer money to cover trading losses in the days before its bankruptcy filing.
Separately, Mr. Giddens’s office said it had already distributed about $1.5 billion in customer funds meant to support trading positions, and that $520 million in additional cash would soon be paid out.
The trustee’s office still controls about $1.6 billion in customer funds, most of which could be distributed early next month.
Beyond the shortfall in customer accounts, Mr. Giddens’s office said it did not have access to money that was held in foreign subsidiaries of MF Global, which are under the control of bankruptcy trustees in those countries.
“While the trustee will pursue them vigorously, it has been his experience that recovery of these foreign assets may take more time,” the office said.
Article source: http://feeds.nytimes.com/click.phdo?i=370c341008c53970d31dd74434373d65
Speak Your Mind
You must be logged in to post a comment.