Stock certificate from MF Global Holdings Ltd.
. This historic document has an
ornate border with the company's logo on top center. This item has the printed signature of the Company's CEO, Jon Corzine.
Jon Corzine's printed signature
Jon Corzine, former CEO of Goldman Sachs, Governor of New Jersey, and United States Senator, began his tenure as CEO of MF Global in March 2010. Corzine spent nearly all of the 9 years prior to joining MF Holdings as either U.S. Senator or Governor. From 1994-1999, Corzine held the role of Chief Executive Officer for Goldman Sachs.
MF Global, formerly known as Man Financial, was a major global financial derivatives broker, or commodities brokerage firm. MF Global provided exchange-traded derivatives, such as futures and options as well as over-the-counter products such as contracts for difference (CFDs), foreign exchange and spread betting. MF Global Inc. its broker-dealer subsidiary, was a primary dealer in United States Treasury securities.
A series of perceived liquidity problems, coupled with large fines and penalties for risk supervision failures dogged MF Global in 2008 and 2009. In February 2008, MF Global was hit with over $10.4 million in fines, a rogue MF Global trader's unauthorized trading in his own account. In March 2008, the stock price plummeted due to fears regarding the liquidity of MF Global among investors, advisers and analysts. In December 2009, a The U.S. Commodity Futures Trading Commission order imposed a $10 million civil monetary penalty on MF Global, relating to four separate instances of risk supervision failures between 2003 and 2008.
In 2011, MF Global faced major pressures to its liquidity over several months. Some analysts and financial commentators indicate that MF Global probably experienced a number of trading days in 2011 during which the firm's bets on sovereign debt would have required the use of customer funds to meet capital requirements, thereby maintaining operating funds and possibly overall solvency. A large part of these pressures on MF Global were a result of the firm's involvement in a significant number of repurchase agreements. Many of these repo agreements were conducted off their balance sheet. Also, MF Global made a $6.3 billion investment on its own behalf in bonds of some of Europe’s most indebted nations. Failure of those, and other, repo positions contributed to the massive liquidity crisis at the firm.
In late October 2011, MF Global experienced a spectacular meltdown of its financial condition, directly caused by improper transfers of over $891 million dollars from customer accounts to a MF broker-dealer account to cover losses created by trading losses.
On October 31, 2011, MF Global executives admitted that transfer of $700 million from customer accounts to the broker-dealer and a loan of $175 million in customer funds to MF Global’s U.K. subsidiary to cover (or mask) liquidity shortfalls at the company occurred on October 28, 2011. MF could not repay these monies with its own funds. Improper co-mingling, or mixing, of company and client funds took place for days before the illicit transfer and loans – and perhaps many other days earlier in the year. According the New York Times, "MF Global dipped again and again into customer funds to meet the demands", perhaps as beginning as early as August 2011.
MF Global declared bankruptcy on October 31, 2011, and faced liquidation beginning in November 2011.
According to a trustee liquidating the company after its collapse, the losses incurred by customers of MF Global stood at $1.6 billion because of the debacle as of April 2012. The vast majority of these funds have not been returned to customers. Rolling Stone reported in April 2012 that the number stands at $1.6 billion, and that "nobody disputes the fact that MF Global officials dipped into customer accounts and took...customer money."
On October 31, 2011, MF Global Holdings Ltd. and MF Global Finance USA Inc. (the “Initial Debtors”) filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code (the "Chapter 11 Cases") in the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court").
On November 7, 2011, the United States Trustee (the “U.S. Trustee”) appointed the statutory creditors’ committee (the “Statutory Creditors’ Committee”) in the Initial Debtors’ cases. The Statutory Creditor’s Committee and the Initial Debtors, on November 21, 2011, jointly moved the Court for an order directing the U.S. Trustee to appoint a chapter 11 trustee, which the Bankruptcy Court entered on November 22, 2011. On November 28, 2011, the Bankruptcy Court entered the Order Approving the Appointment of Chapter 11 Trustee, pursuant to which Louis J. Freeh, Esq was appointed the Chapter 11 trustee (the “Trustee) of the Initial Debtors.
On December 19, 2011, MF Global Capital LLC, MF Global Market Services LLC and MF Global FX Clear LLC (the “New Debtors” and together with the Initial Debtors, the “Debtors”) filed voluntary petitions for relief in the Bankruptcy Court. On December 27, 2011, the Bankruptcy Court entered an order approving the appointment of the Trustee as Chapter 11 Trustee of the New Debtors.
On March 2, 2012, MF Global Holdings USA Inc. (the “New Debtor” and together with the Initial Debtors, the “Debtors”) filed a voluntary petition for relief in the Bankruptcy Court. On December 27, 2011, the Bankruptcy Court entered an order approving the appointment of the Trustee as Chapter 11 Trustee of the New Debtors.
On June 28, 2012, the Bankruptcy Court entered an order establishing August 22, 2012 at 5:00 p.m. (Prevailing Eastern Time) as the last date and time for each person or entity (including, without limitation, individuals, partnerships, corporations, joint ventures, estates and trusts), other than any governmental units (as defined in section 101(27) of the Bankruptcy Code) (“Governmental Units”), to file a proof of claim against MF Global Holdings Ltd., MF Global Finance USA, Inc., MF Global Capital LLC, MF Global FX Clear LLC, MF Global Market Services LLC and/or MF Global Holdings USA Inc. Solely as to Governmental Units, the Bar Date Order established August 29, 2012 at 5:00 p.m. (Prevailing Eastern Time) as the last date and time for each such Governmental Unit to file a proof of claim against the Debtors.
On February 15, 2013, the Bankruptcy Court entered an Order granting the Chapter 11 Trustee’s motion to establish the Administrative Bar Date as March 15, 2013 at 4:00 p.m. (Prevailing Eastern Time) as the last date and time for each person or entity (including, without limitation, individuals, partnerships, corporations, joint ventures, estates and trusts), to file an Administrative proof of claim against MF Global Holdings Ltd., MF Global Finance USA, Inc., MF Global Capital LLC, MF Global FX Clear LLC, MF Global Market Services LLC and/or MF Global Holdings USA Inc.
On April 5, 2013, the Court entered an Order confirming the Amended and Restated Joint Plan of Liquidation Pursuant to Chapter 11 of the Bankruptcy Code for MF Global Holdings Ltd., MF Global Finance USA Inc., MF Global Capital LLC, MF Global FX Clear LLC, MF Global Market Services LLC, and MF Global Holdings USA Inc.
The Debtors are jointly administered under Case number 11-15059 (MG). The Chapter 11 Cases have been assigned to the Honorable Martin Glenn.
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