Hunt for $600m MF Global cash begins to produce results

THE SEARCH for $600m (£373m) in missing customer money from defunct broker MF Global Holdings may begin with a lender in Chicago, it emerged last night.

A Harris Bank branch office was the main repository for money from many of MF Global’s 150,000 customers, according to customers and representatives with smaller investment firms that introduced clients to the brokerage.

The FBI is set to begin its search for the missing money with Harris Bank, which holds client money for many large futures brokerage firms and is part of the Bank of Montreal.

Sources said investigators are looking into what happened to customer money held in segregated accounts at Harris Bank. Segregated accounts are used by brokers to keep customers’ money separate from the firm’s cash.

Harris Bank said it could not discuss customer accounts.

Meanwhile traders said yesterday that futures giants Newedge, BNP Paribas and JP Morgan are favourites to attract the European clients of MF Global. Customers want to restart trading but are said to be choosing their new clearing brokers carefully.

“Some clearing brokers are deemed safer and the biggest names in the business are Newedge, JPM and BNP,” said an options broker in London.