Clients of failed futures trading firm MF Global Inc. will likely see all of their money returned, reports the U.S. securities industry contingency fund, the Securities Investor Protection Corp. (SIPC).
SIPC announced last week that between US$500 million and US$600 million will be returned to the MF Global estate under an agreement announced by the SIPA trustee for the liquidation of MF Global, James Giddens, and Richard Heis, a joint administrator of MF Global UK Ltd. And, Giddens and the the bankruptcy trustee for MF Global Holdings Ltd., Louis Freeh, also announced that they will resolve all claims between their respective estates.
As a result, SIPC says that, once certain conditions are satisfied to make the agreements effective, and if they are approved by the U.S. bankruptcy courts, Giddens anticipates the agreement between MF Global and MF Global UK will result in 100% satisfaction of allowed securities customers’ claims; and, he expects significant additional distributions to commodities customers who traded on U.S. and non-U.S. exchanges.
“These agreements are a major accomplishment that will benefit customers and creditors worldwide. Not only will the agreements with MFGH and MFGUK likely allow for the return of 100% of allowed securities customers claims, it will also result in significant distributions to be made to commodities customers,” said SIPC president, Stephen Harbeck.