WASHINGTON, June 15 (Reuters) – A US futures regulatorsaid he was keen to see his agency hire its own attorney inBritain to help recover customer funds lost during MF Global’s chaotic final days.
WASHINGTON (Reuters) – Futures customers should have access to a fund that guarantees their accounts up to a certain threshold, the trustee liquidating MF Global Holdings Ltd said in a report on Monday.
In doing so, they violated the most basic obligation of any brokerage firm, which is to protect customers’ assets.
The CME, which drew criticism from MF Global clients over its early handling of the firm’s failure, offered a financial guarantee that enabled the trustee to free up the majority of customer cash and other property held by MF Global when it failed.
Thursday’s agreement does not yet alter Gidden’s estimate of $1.6 billion in customer funds held by MF Global that have yet to be returned to customers.
In response to Chilton’s comments, a spokesman for Giddens said the CFTC was free to hire its own counsel, but the trustee was 100 percent aligned with the regulatory agency.
If fees were rejected after being paid, Hughes Hubbard would likely credit the total toward future bills rather than give money back, Giddens’ spokesman, Kent Jarrell, told Reuters in April.
The difference between what MF Global actually owed its customers and what it needed to segregate under the alternative method was calculated at the firm on a daily basis and often exceeded $1 billion.
The bankruptcy and missing funds have been the focus of several congressional hearings and are under investigation by federal agencies, including the FBI and the CFTC.
Under terms of the agreement struck Thursday, CME’s own claims will have a lower priority of payment than MF Global’s former customers.
JPMorgan was the failed firm’s biggest lender and isinvolved in discussions with trustees over whether it may beholding money belonging to MF Global customers.
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