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MF Global News (11/10/11 AM)

The latest news on the MF Global bankruptcy and fallout, published in the John Lothian Newsletter the morning of November 10, 2011.

In the wake of the MF Global bankruptcy, John Lothian Newsletter has created a special section on JohnLothianNewsletter.com devoted to news, information and commentary. The section features archived news stories featured in the John Lothian Newsletter, analysis and breaking news. Check regularly for updates. See the MF Global news section here.

CME Group Provides Update on Customer Account Verification Process in Conjunction With Bulk Transfers of MF Global Accounts
Press Release
CHICAGO, Nov. 9, 2011 /PRNewswire/ — CME Group today provided an update regarding the process it announced November 4, 2011 to verify customer collateral transferred to receiving firms through the MF Global bulk transfer process, as authorized by the Trustee.
http://jlne.ws/cjpXe7

UPDATE: Some MF Customers See Frozen Funds Thaw, Others Don’t
By Jacob Bunge Of DOW JONES NEWSWIRES
CME Group Inc. (CME).said Wednesday that some former MF Global Holdings Ltd. (MFGLQ) clients may have to wait until the end of the week to access accounts frozen after the broker-dealer’s bankruptcy, though some funds have finally been thawed.
http://jlne.ws/u0Ed9b

CME Group says transferring MF Global collateral is slow going
Reuters
(Reuters) — The transfer and verification of former MF Global customers’ collateral to new brokerages is taking longer than expected, the CME Group said on Wednesday, despite hopes that the release of funds would now be well under way.
http://jlne.ws/rEdz6r

ICE Clear Europe Completes Transfer or Closure of MF Global UK Ltd Positions
Press Release
LONDON, Nov. 9, 2011 /PRNewswire/ — IntercontinentalExchange (NYSE: ICE), a leading operator of global regulated futures exchanges, clearing houses and over-the-counter (OTC) markets, today announced that ICE Clear Europe has completed the transfer (termination and replacement of contracts) or closure of all MF Global UK Ltd client and proprietary positions. A large number of client positions, together comprising a substantial majority of MF Global UK Ltd open interest, were transferred to alternative clearing members at the request of customers. The balance of open positions were liquidated. Throughout the close-out process, ICE Clear Europe remained fully collaterised.
http://jlne.ws/sVVTLP

Futures Industry Group Urges Return Of MF Customer Funds
By Jacob Bunge Of DOW JONES NEWSWIRES
The main trade body for the futures industry on Wednesday pushed for a faster return of customer funds locked up in the bankruptcy of MF Global Holdings Ltd. (MFGLQ), warning that some investors can’t afford to pursue claims on their frozen assets. The Futures Industry Association called on the trustee supervising the liquidation of MF Global to complete an “interim accounting” and return the money MF Global’s brokerage customers held on deposit with the failed New York firm, either in cash or backing trades.

MF Global May Have Used Customer Funds In The Losing $6.3 Billion Trade Without Informing Clients
Robert Lenzner – Forbes
After an intense day of investigation, I have just discovered that a CFTC rule(1.29) allowed Jon Corzine’s MF Global to use the margin and cash in customers heretofore segregated accounts to amass a risky $6.3 billion investment in European sovereign debt that backfired. Nor did Corzine have the obligation to inform any of these customers he was gambling with their money. Or that he was intending to keep all the profits for himself and his troubled firm. Nothing for the customers.
http://jlne.ws/t3GanN

Clients Question Oversight by MF Global’s Regulator
By AZAM AHMED and BEN PROTESS – NY Times
Futures trading, which caters to farmers as well as to hedge funds, was left largely untouched when lawmakers took on Wall Street after the financial crisis. But a light regulatory hand is now being called into question after the collapse of MF Global, the brokerage firm run by Jon S. Corzine until last week.
http://jlne.ws/vT2YJQ

MF Global Settlement Over Losses in Doubt After Bankruptcy
BusinessWeek
A $90 million settlement of an investor lawsuit against MF Global Holdings Ltd. and its former parent, Man Group Plc, over a 2008 wheat-trading loss was cast into doubt by the futures broker’s bankruptcy filing.
http://jlne.ws/w0Nxay

Insight: Clients who fled MF Global face clawback risk
Reuters via Yahoo! News
NEW YORK (Reuters) – Former MF Global customers like Koch Industries, who pulled billions of dollars out of the stricken broker’s accounts weeks or months before its collapse, have counted their blessings in recent days.
http://jlne.ws/urJYBd

CEO Corzine Should Have Listened to Gov. Corzine
The Atlantic Wire via Yahoo! News
The decisions that Jon Corzine was held responsible for as CEO of the now-bankrupt MF Global were ones he had been warning against only a bit earlier as New Jersey governor, as Jon Stewart laid out in a series of clips on last night’s Daily Show. As an introduction, the host deemed Corzine an embodiment of the tangled web of “the corporate-industrial-government complex. …
http://jlne.ws/vufb62

Friendship Is Tossed in MF Global Storm
Flowers and Corzine Relationship Dates to Goldman Days
By GINA CHON – WSJ
The 3 a.m. call on Halloween morning came as a shock to J. Christopher Flowers. The private-equity titan had gone to sleep the night before convinced that one of his investments, MF Global Holdings Ltd., the ailing securities firm run by his longtime friend Jon S. Corzine, would be saved through a sale to a rival.
http://jlne.ws/urHHBa

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