Trustee of MF Global to pay back lost funds

 
City A.M. Reporter
THE TRUSTEE liquidating the brokerage unit of MF Global Holdings yesterday asked a federal bankruptcy judge for permission to return remaining funds to commodity trader customers affected by the firm’s 2011 collapse.

The request by court-appointed trustee James Giddens would reallocate some money earmarked for general unsecured creditors to customers of the brokerage, who have a higher-priority payback status.

The move could bring closure to customers who have waited nearly two years to fully recover their money, which became tied up when MF Global went bankrupt on 31 October 2011. Giddens has estimated that $1.6bn (£989m) went missing from customer accounts, mainly in the few days prior to MF Global’s collapse, and that so far about 98 per cent of the money has been returned to customers who traded on US exchanges, and 74 per cent to customers who traded on foreign exchanges. MF Global was a commodities brokerage run by Jon Corzine, the former New Jersey governor and senator and a former Goldman Sachs chairman.