Bankruptcy Court Approves SIPA Trustee Motion to Transfer Commodity Accounts
NEW YORK, November 2 – U.S. Bankruptcy Judge Martin Glenn today approved the request by James W. Giddens, the Trustee for the liquidation of MF Global Inc., to allow the transfer of certain segregated customer commodity positions from MF Global Inc. to one or more futures commission merchants, potentially allowing the transfer of approximately 50,000 accounts, the substantial majority of which were cleared through the Chicago Mercantile Exchange (CME). The account transfers meet the Trustee’s Securities Investor Protection Act (SIPA) mandate to protect customers.
The Trustee, in cooperation with the Securities Investor Protection Corporation (SIPC) and the Commodity Futures Trading Commission (CFTC) determined that account transfers will contribute to the prompt satisfaction of commodity customer claims and the orderly liquidation of MF Global Inc.
The result of the order, achieved in close cooperation with CFTC chairman Gary Gensler and his staff allows a substantial portion of all the existing commodity accounts at MF Global Inc. to be transferred. Additionally, these transfers will unfreeze commodity positions with a notional value of $100 billion.
“The ability to transfer thousands of accounts is a significant first step in protecting customer property and is the result of leadership from CFTC and SIPC,” said Giddens, a partner at Hughes Hubbard & Reed LLP in New York.
The information in this statement does not apply to any other MF Global entity, including separate insolvency proceedings involving MF Global Holdings Ltd. or MF Global Finance USA Inc.
CHICAGO, Nov. 2, 2011 /PRNewswire/ -- Throughout this week, CME Group has worked diligently with the CFTC and the MF Global bankruptcy trustee to facilitate the transfer of MF Global customer positions to other qualified clearing members. We are pleased to share that the bankruptcy court has approved our proposal to transfer accounts to qualified firms along with a portion of CME Clearing-held collateral. We will continue to facilitate the transfer of positions and accounts of customers and affiliates of MF Global, and will also continue to assist the efforts of the CFTC and bankruptcy trustee to recover customer segregated funds held by MF Global.
PDF of MFG Trustee Petition