Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  Equities  >  OTC Bulletin Board  >  MF Global Holdings Ltd    MFGLQ

SummaryNewsCalendarCompanyFinancials 
News SummaryMost relevantAll newsSector news 

MF Global Trustee Begins Litigation In UK Over Customer Assets

share with twitter share with LinkedIn share with facebook
share via e-mail
0
05/04/2012 | 12:09am CEST

("MF Global Trustee Begins Litigation In UK Over Customer Assets" published at 5:10 p.m. EDT, incorrectly said in the eighth paragraph that KPMG is also the administrator for Lehman in the U.K. A corrected version follows.)

 
   By Joseph Checkler 
   Of DOW JONES DAILY BANKRUPTCY REVIEW 
 

The trustee unwinding MF Global Holdings Inc.'s (>> MF Global Holdings Ltd) brokerage said Thursday that litigation has begun in the U.K. over $700 million in disputed customer assets, setting up a fight with the company's U.K. administrator, KPMG LLP.

KPMG made a filing in the U.K. seeking direction from a court, said trustee James W. Giddens, taking the first legal step in a battle over the money. Giddens last month said he requested KPMG to make that filing, which KPMG said it would do.

A spokesman for KPMG didn't immediately comment Thursday. Kent Jarrell, a spokesman for Giddens, said details of the filing will remain confidential under U.K. law until the first hearing in the case.

Giddens and KPMG both see the $700 million as their responsibility, and last month both sides acknowledged that the issue would probably be best decided in court. The $700 million is part of an estimated $1.6 billion in money held in "segregated" MF Global customer accounts that has been missing since its parent company filed for bankruptcy Oct. 31.

"As the advocate for all former customers of MF Global Inc., we are prepared to fight in any jurisdiction for the return of customer funds to their rightful owners," Giddens said in a statement, referring to the brokerage by its official name.

The U.K. dispute centers on whether a $700 million claim by MF Global Inc. against MF Global UK should be treated as a claim against the U.K.'s segregated pool of client funds or whether it should be treated as an unsecured claim against the estate.

If the claim is against a segregated pool, Giddens will be able to return the money to U.S. clients. If the claim falls into the nonsegregated pool, the trustee will be treated as a general creditor and unlikely to recover any money.

In a decision earlier this year that could be seen as a precedent, the U.K. Supreme Court said billions of dollars in client cash belonged to Lehman Brothers Holdings Inc.'s (LEHMQ) brokerage regardless of whether it was properly segregated. The decision was a win for customers of Lehman's U.S. unit and Giddens, who also is unwinding Lehman's brokerage.

Giddens is winding down MF Global's broker-dealer business under the authority of the Securities Investor Protection Act, which governs the liquidation of failed brokerage firms. The liquidation is separate from the bankruptcy case of MF Global Holdings, the parent company, which filed for Chapter 11 protection last Oct. 31. That estate is now being overseen by Louis J. Freeh, a former director of the Federal Bureau of Investigation.

Giddens has recovered about $5.3 billion of the $5.5 billion to $6 billion in U.S. customers' segregated funds held at the brokerage and has returned more than $4 billion to customers via a series of bulk transfers arranged by CME Group Inc. (CME) in the weeks following MF Global's demise last year.

-By Joseph Checkler, Dow Jones Newswires; 212-416-2152; joseph.checkler@dowjones.com

--Jessica Hodgson, Patrick Fitzgerald and Marietta Cauchi contributed to this article.

Stocks mentioned in the article : MF Global Holdings Ltd
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on MF GLOBAL HOLDINGS LTD
2015DJMF GLOBAL : PwC to Pay $65 Million to Settle Suit Over MF Global
2015DJGroup of Financial Institutions Settles MF Global Suit
2014DJMF GLOBAL : Bid by MF Global Ex-Managers to Tap More Insurance Funding Opposed
2014DJMF GLOBAL HOLDINGS LTD : Judge Allows MF Global Lawsuit to Proceed
2013DJGOLDMAN SACHS GROUP INC : Payback of MF Global Customers Approved
2013DJGOLDMAN SACHS GROUP INC : Judge Approves 100% Payback of MF Global Commodity Cus..
2013DJGOLDMAN SACHS GROUP INC : MF Global Targets Payment to Former Executive
2013DJGOLDMAN SACHS GROUP INC : MF Global Going After $3 Million Payment to Former Fix..
2013DJGOLDMAN SACHS GROUP INC : MF Global Suing JC Flowers Over Dividends Paid Before ..
2013DJFormer FBI Director Freeh Seeks $1 Million Fee for MF Global Work
More news
Sector news : Brokerage Services
08:48aDJFinance Watch -- WSJ
08/25DJCIBC Revenue and Profit Rise
08/24DJBlockchain Firm R3 Files for a Patent as Fintech Race Heats Up--Update
08/24 MORGAN STANLEY : HK regulator fines Morgan Stanley, cites internal control failu..
08/24DJGOLDMAN SACHS : Funds Loan Firm -- WSJ
More sector news : Brokerage Services
Advertisement
Income Statement Evolution
More Financials
Sector and Competitors
1st jan.Capitalization (M$)
MF GLOBAL HOLDINGS LTD0
GUOTAI JUNAN SECURITIE..-22.97%21 092
ORIENT SECURITIES CO L..-28.77%14 017
WESTERN SECURITIES CO ..--.--%10 682
CHANGJIANG SECURITIES ..--.--%9 172
DONGXING SECURITIES CO..-23.96%8 575
More Results