Wednesday, February 1, 2012

Judge: No Special Priority For MF Global Customers

Judge Martin Glenn
'We don't have the power to help the individual clients, and even if we did, we wouldn't!'  At least Judge Glen is honest (regarding the we wouldn't part) while being corrupt. 
One would think however that a judge would be required to understand bankruptcy law, and might care about the fact that MF Global's bankruptcy was filed under the wrong sub-chapter of the bankruptcy code, as a securities firm, rather than a commodities brokerage (which is what MF Global was!).  This is especially true due to the fact that the subsection of bankruptcy law dealing with commodities brokerages place CUSTOMERS AT THE FRONT OF THE CREDITOR LINE, due to the fact that they are not covered by the SIPC insurance, because the firm was not a securities firm.
Apparently Martin Glen is not interested in the fact that the MFG bankruptcy was filed as a securities brokerage bankruptcy rather than as commodities brokerage bankruptcy, because that would have required clients to be paid back first. 
And clearly, Judge Martin has neither the power, nor the will to make clients whole. 
What a load of S***!!

A federal bankruptcy judge Wednesday rejected a bid by commodities customers of MF Global Inc. for special priority status over other creditors in the Chapter 11 case of its parent company, MF Global Holdings Ltd.
Judge Martin Glenn of the U.S. Bankruptcy Court in New York rejected an attempt by investment firm Sapere Wealth Management LLC and other commodities customers with segregated accounts to be moved ahead of other creditors.
“Under the Bankruptcy Code, the court does not have the power to grant the relief requested, and Sapere has failed to allege any facts to support its motion,” Glenn wrote. And even if it did, Glenn wrote, the court would decline to do so.
Sapere wanted MF Global Inc.’s commodities customers that held segregated accounts to be treated as a customer class of parent company MF Global Holdings Ltd., which is in Chapter 11. Those accounts are the same, with an estimated shortfall of at least $1.2 billion, according to the trustee unwinding MF Global’s brokerage.
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