Monday, October 31, 2011

Regulators Discover MF Global May Have Stolen $700 Million from CLIENTS in Past 72 Hours in Attempts to Meet Margin Calls!

The NY Times is reporting that MF Global may have "borrowed" nearly $1 BILLION of CLIENT'S FUNDS to meet margin calls as the firm teetered on the verge of bankruptcy. 
And by "borrowed", we mean stole and used to meet margin calls.

If this turns out to be the case, no matter how much porn the SEC has on its laptops, Jon Corzine can expect to become the first major bankster of the financial crisis to end up in jail.


Federal regulators have discovered that hundreds of millions of dollars in customer money have gone missing from MF Global in recent days, prompting an investigation into the company’s operations as it filed for bankruptcy on Monday, according to several people briefed on the matter.

The revelation of the missing money scuttled an 11th hour deal for MF Global to sell a major part of itself to a rival brokerage firm. MF Global, the powerhouse commodities brokerage run by Jon S. Corzine, had staked its survival on completing the deal.
What began as nearly $1 billion missing had dropped to less than $700 million by late Monday.
It is unclear where the money went, and some money is expected to trickle in over the coming days as the firm sorts through the bankruptcy process, the people said.
But regulators are examining whether MF Global diverted some customer money to support its own trades as the firm teetered on the brink of collapse. If that was the case, it could violate a fundamental tenet of Wall Street regulation: Customers’ money must be kept separate from company money.
Read more from the NY Times: