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Forum Post: MF Global Client Theft Estimate Doubled To $1.5 BILLION?

Posted 6 years ago on Nov. 2, 2011, 5:53 p.m. EST by MonetizingDiscontent (1257)
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MF Global Client Theft Estimate Doubled To $1.5 BILLION?


Even as we hear rumblings that the MF fire is spreading, and the associated auditor of the now infamous former Primary Dealer is about to get in serious hot water, the bankrupt company itself continues to dig itself an ever deeper grave. Because according to a just filed motion by the MF Global liquidating trustee, it seems that the gross criminal activity by the company may have been orders of magnitude bigger than anyone has expected.

To wit: "As a result of the apparent segregation violations and the suspension of clearing privileges, more than 150,000 customer accounts essentially were frozen on October 31, 2011, of which more than 50,000 accounts were regulated commodities customer accounts.

The CME estimates that MFGI’s current segregated funds requirement is approximately $5.45 billion. Moreover, the total amount of MFGI customer segregated funds on deposit at the CME is approximately $2.5 billion, and the clearing-level segregated collateral is approximately $1.5 billion or approximately 60 percent of the MFGI customer segregated funds on deposit at the CME."

Doing some quick inverse addition and we get a (w)hole of $5.45 less $2.5 less $1.5 or $1.45 billion. In other words, the theft by MF Global was not stealing hunderds of millions form its customers: it has stolen a whopping $1.5 billion!

For those confused, this is not a rogue loss of $1.5 billion, something which was enough to send UBS' Kweku to prison. This is outright theft resulting from illegally commingled accounts. Our only question is will $1.5 billion in theft be enough for the first real perp walk of an Obama-friendly Wall Street executive?

And here is Reuters with a revised lowball. Remember this number was supposed to be zero earlier today. (link below)

Continue Reading at: http://www.zerohedge.com/news/mf-global-client-theft-estimate-doubled-15-billion

When all is said and done, the shortfall will be well over a billion.

Someone Is Going To Jail For This: MF Global Caught Stealing Hundreds Of Millions From Customers?


Regulators Investigating MF Global For $700 Million In Missing Client Funds - Was It Stolen By Management?


BREAKING -MF Global Admits Using Client Money-


This is not looking good for former New Jersey Senator and Governor, and previously Goldman Sachs CEO Jon Corzine. More than $700 million of supposedly safeguarded client funds were stolen by MF Global to support besieged trading positions. Jon Corzine should go to prison. If Corzine escapes without a Federal ID number and associated orange jumpsuit due to fundraising ties with Obama and Eric Holder, then the game is over.

How Former Goldman CEO And NJ Governor Jon Corzine Ran MF Global Into The Ground


-MF Global is first big US victim of Europe crisis-




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[-] 1 points by MonetizingDiscontent (1257) 6 years ago

-JPMorgan Seeks Lien On ALL MF Global Assets-


(BLOOMBERG) JPMorgan Chase & Co. (JPM) seeks a lien on all of MF Global Holdings Ltd.’s assets and may have a lien on its operating account balance of $26.6 million, the bank said.

MF Global, which filed for bankruptcy with assets of $41 billion, has five operating accounts, all with JPMorgan. The bank may have a lien on the entire balance because of so-called setoff rights related to a credit line to MF Global where it acts and agent and lender, the New York-based bank said in a filing.

“JPMorgan asserts, and the debtors admit, that ‘by virtue of such setoff rights, such funds may be subject to liens in favor of’” JPMorgan, it said.

Lenders move to protect themselves after a bankruptcy filing. JPMorgan, the biggest U.S. bank, made the statement in an objection filed in U.S. Bankruptcy Court in Manhattan today to a cash management plan proposed by the company. Limits should be placed on the company’s use of cash, it said.

JPMorgan holds less than $80 million of the MF Global’s debt, said Joseph Evangelisti, a spokesman for the New York- based bank and acts as an agent to lenders for a $1.2 billion credit line to MF Global Holdings and a $300 million credit line to its broker-dealer unit.

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