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MF Global News (12/8/11 AM)

The latest news on the MF Global bankruptcy and fallout, published in the John Lothian Newsletter (subscribe here) the morning of December 8, 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.

Corzine: ‘I Simply Do Not Know Where The Money Is’
By SCOTT PATTERSON and AARON LUCCHETTI – WSJ
A contrite Jon S. Corzine will express both sorrow and a firm defense of his actions Thursday in his first public appearance since the collapse of MF Global Holdings Ltd. in late October.
http://jlne.ws/sOycRZ

Corzine Says He Doesn’t Know Location of Missing Funds
By Silla Brush
Dec. 8 (Bloomberg) — Jon S. Corzine, former chairman and chief executive officer of MF Global Holdings Ltd., will apologize to investors, customers and employees of the failed New York broker and tell lawmakers he doesn’t know the location of the estimated $1.2 billion in missing client money.
http://jlne.ws/sFTVbd

Corzine: ‘I don’t know where the money is’
By Aaron Smith @CNNMoney
NEW YORK (CNNMoney) — Jon Corzine, the former chief executive officer of the bankrupt broker MF Global, apologized for his firm’s failure Thursday and told a House committee that he doesn’t know where the missing money went.
http://jlne.ws/u8Kg87

MF Global’s European Exposure Apparent Since May – CBOE
By Doug Cameron Of DOW JONES NEWSWIRES
A senior U.S. exchange industry executive will tell lawmakers Thursday that the contentious European sovereign debt holdings of MF Global Holdings (MFGLQ) first became apparent at the end of May, triggering efforts by regulators that forced the failed broker-dealer to change its accounting practices.
http://jlne.ws/vUH4Mg

CME’s Duffy: MF Global Broke Rules, Tapped Customer Funds 
By Jacob Bunge Of DOW JONES NEWSWIRES
Officials at MF Global Holdings Inc. (MFGLQ) illegally used customers’ money for the firm’s own benefit in its final days of life, according to the executive chairman of exchange operator CME Group Inc. (CME).
http://jlne.ws/sWlrdz

Testimony of Daniel J. Roth, President and CEO, National Futures Association
Before the Committee on Agriculture, U.S. House of Representatives
Press Release
[…] The recent demise of MF Global has dealt a severe blow to the public’s confidence in the financial integrity of our futures markets.  This is much more than an academic argument.  Thousands of customers have suffered and continue to suffer from a breakdown in the regulatory protections they have come to expect.  Their frustration with the situation is completely understandable.  Reestablishing the public’s confidence is essential to our futures markets, which, in turn, are an essential part of our nation’s economy.
http://jlne.ws/vl4Dvj

R.J. O’Brien CEO Corcoran Testifies on Behalf of RJO and Commodity Markets Council at House Agriculture Committee Hearing on MF Global Bankruptcy
Press Release
WASHINGTON, DC, December 8, 2011 – The U.S. House Committee on Agriculture is convening a hearing this morning at 9:30 a.m. ET on the Examination of the MF Global Bankruptcy. Gerald F. Corcoran, Chairman and Chief Executive Officer of R.J. O’Brien & Associates (RJO), offered testimony today on behalf of the Commodity Markets Council (CMC) and RJO. He put forth ideas for consideration and discussion on possible improvements to the futures industry‘s financial safeguard system.
http://jlne.ws/uzWDaT

Regulators diverge over MF Global collapse
By Shahien Nasiripour, Tom Braithwaite and Kara Scannell in New York – Financial Times
Regulators are expected to give diverging accounts about when they first became concerned over the state of MF Global, the broker-dealer that collapsed on October 31 with an estimated $1.2bn of customer money missing.
http://jlne.ws/tC0X2h

Corzine revisits Congress in uncomfortable role
AP via Yahoo! News
For five years, Jon Corzine embodied one of the most prestigious positions in Washington: U.S. senator. On Thursday, he is scheduled to return to Capitol Hill in a humbled and humiliating role: a star witness likely to invoke the Fifth Amendment.
http://jlne.ws/urLNPZ

10 Questions for Jon Corzine [NY Times version]
By STEVEN M. DAVIDOFF and PETER J. HENNING
Jon S. Corzine, the former chief executive of MF Global Holdings and a former Democratic senator from New Jersey, is being forced to return to Capitol Hill on Thursday morning. The House Agricultural Committee subpoenaed Mr. Corzine after he resisted the committee’s request that he voluntarily answer questions.
http://jlne.ws/t4Xxa0

10 questions for Jon Corzine [CNN version]
CNN Money
The former chief of the bankrupt firm MF Global heads to Capitol Hill on Thursday. Here are some questions for Jon Corzine’s congressional grillers.
http://jlne.ws/sc96bn

ICE’s Sprecher Sees Opening to Hold Futures Cash After MF Failed
By Matthew Leising
Dec. 7 (Bloomberg) — Intercontinental Exchange Inc., the second-largest U.S. futures exchange, could expand its business by holding excess futures customer money, said Chief Executive Officer Jeffrey Sprecher. “It’s a new opportunity for us,” Sprecher said, adding that ICE isn’t necessarily pushing for this change. “It gives us a bigger, broader customer base and a new way to serve them.” Brokers and clearinghouses that currently hold customer funds earn interest income on the collateral.

CME forms panel to head off future MF Globals
Reuters
CME Group Inc., under fire for its handling of the collapse of futures brokerage MF Global Holdings Ltd., recently tasked a board committee to look at ways to defend against future failures. CME’s strategic steering committee is spearheading the charge to see “how do you strengthen the system, if it’s necessary,” said a person close to the matter, who declined to be identified because the examination is just beginning. “It’s not something you are going to get a decision on tomorrow, or anything like that.”
http://jlne.ws/rPi8bo

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