Customers who are missing $1.6 million in funds tied to the collapse of the futures brokerage MF Global Holdings Ltd. will eventually get their money back, according to trustee Louis Freeh.
Freeh, who is trying to recoup money for the defunct company’s creditors, told the Senate Agriculture Committee in a written testimony that he is confident that “all of the customers of MF Global Inc. eventually will be made whole.”
Freeh’s statement offers hope to MF Global customers who have only seen a 72 percent return on the estimated $5.5 billion in segregated funds that were frozen when MF Global collapsed in October 2011. The futures brokerage failed due to its large bets on European debt, and it then took money from customer accounts in a last-ditch effort to remain afloat. Prosecutors and regulators are still investigating who was responsible for money being taken from customer accounts.
Nonetheless, James Giddens, the trustee who is trying to recoup funds for MF Global’s U.S. brokerage firm’s customers, hasn’t indicated the same optimism as Freeh. He previously said that although investigators have located most of the missing funds, prolonged litigation may be necessary to recover the money.
Read Thomson Reuters and the Wall Street Journal for more information.
Read more InsideCounsel coverage of MF Global’s collapse:
MF Global GC will testify tomorrow at House hearing
MF Global customer says entire $50 million account missing
7 banks targeted over MF Global collapse
FBI probe continues MF Global’s downward spiral
MF Global’s customer account discrepancies spur regulatory probe
