MF Global Client Theft Estimate Doubled To $1.5 Billion?
Even as we hear rumblings that the MF fire is spreading, and the associated auditor of the now infamous former Primary Dealer is about to get in serious hot water, the bankrupt company itself continues to dig itself an ever deeper grave. Because according to a just filed motion by the MF Global liquidating trustee, it seems that the gross criminal activity by the company may have been orders of magnitude bigger than anyone has expected. To wit: "As a result of the apparent segregation violations and the suspension of clearing privileges, more than 150,000 customer accounts essentially were frozen on October 31, 2011, of which more than 50,000 accounts were regulated commodities customer accounts. The CME estimates that MFGI’s current segregated funds requirement is approximately $5.45 billion. Moreover, the total amount of MFGI customer segregated funds on deposit at the CME is approximately $2.5 billion, and the clearing-level segregated collateral is approximately $1.5 billion or approximately 60 percent of the MFGI customer segregated funds on deposit at the CME." Doing some quick inverse addition and we get a (w)hole of $5.45 less $2.5 less $1.5 or $1.45 billion. In other words, the theft by MF Global was not stealing hunderds of millions form its customers: it has stolen a whopping $1.5 billion! For those confused, this is not a rogue loss of $1.5 billion, something which was enough to send UBS' Kweku to prison. This is outright theft resulting from illegally commingled accounts. Our only question is will $1.5 billion in theft be enough for the first real perp walk of an Obama-friendly Wall Street executive?
And here is Reuters with a revised lowball. Remember this number was supposed to be zero earlier today.
MF Global had a $633 million
shortfall in its customer segregated funds as of Nov. 1, according to an
estimate the CME Group provided to the U.S. futures regulator.
That amounted to an 11.6 percent deficiency.
In the letter dated Nov. 2, the Commodity Futures Trading Commission
said the CME has identified futures commission merchants (FCMs) willing
to accept transfer of MF Global customer segregated account positions of
retail and institutional customers.
The futures regulator also
said that CME anticipates that MF Global customer segregated account
positions will be transferred to two or more of five identified clearing
members.
MF Global, which filed for bankruptcy protection on
Monday, is the biggest U.S. casualty of Europe's debt crisis, and the
seventh-largest bankruptcy by assets in U.S. history.
When all is said and done, the shortfall will be well over a billion.
h/t Doug
(19 votes)
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Michael Clayton is in Corzine's kitchen as we read this.
more like barry's shug knight...aka..otherwise known as joe yamookaah biden
This whole situation makes me sick to my stomach, and I'm sure as fuck glad I'm not a current/former/ever MF customer. Just trying to empathize with the victims.
I often fantasize about shooting people like John Corzine in the head. I've never killed anybody, but I probably wouldn't be haunted if I just up and did him in right this minute.
Corzine would have made a great treasury secretary
http://www.thenation.com/blog/treasury-secretary-jon-corzine
Corzine's anal virginity: http://www.southparkstudios.com/clips/222624/the-importance-of-saving-money
Corzine needs to go to prison and be someone's azz slave just because he is Corzine. I hate the guy. Typical sanctimonious rich democrat.
Biggest POS on planet Earth.
I don't know DoChen, the earth is pretty big and he's competing with quite a few POS's from Washington, NY, etc.
A top ten list can't be created because you can't squeeze several hundred in there.
Aw, common, everything's fine. What's $1.5 billion between friends?
1.5 billion public lashing for the the theft .. would be a nice start
Only rogue traders get the perp walk.
Plus USGov will cover this. I mean USTaxpayers will cover this. Man....Bamie's got your back Dudes. Don't sweat it.
Troll, flawlessly logical and beautiful in its simplicity: Just because he is Corzine.
Two thumbs up. Way up.
You're right - he's almost as bad as the typical sanctimonious rich republican.
Since I was displaced by the recent disaster, and live in Southern California, Occupy Los Angeles ended up being an obvious destination.
I went to Occupy LA with an agenda of uncovering infiltrators into the movement who seek to undermine it, and get the real word out - it is a foregone conclusion that the mainstream media would lie about everything.
I had enormous success with both things,
To start;
The "official" representation for Occupy Los Angeles may have been usurped and appears to be intentionally not getting the word out about what the movement actually stands for. I was invited to join the media team but refused after seeing the media tent, which despite having several Macintosh computers and at least 10 windows based laptops as well as innumerable cameras and a full time broadband connection, had failed to output ANY video in three weeks (as of Oct 24) other than a three minute clip from a flip camcorder. This was discussed during a media meeting which I attended on October 24.
Many media outlets have stated Occupy Los Angeles has no direction. But after being on site for four days, I can clearly state that there is a strong direction and strong demands are being made, demands which get usurped by the powers that be who are on scene and claim to be part of the movement. One pass through that camp will reveal a powerful resolve and message; a message which has been stifled, and I have proof of that here in photos. The demands are:
1. An end to the banker bailouts and an end to centralized PRIVATE banking (Federal Reserve). This is very closely followed by an end to all forms of corporate welfare and "buying" of electoral candidates by corporations.
2. An end to insider trading and favored status being given to investment firms like Goldman Sachs.
3. Media accountability - the movement is well aware of the fact that it is a few families of a particular (small) religious group that owns the media, which during elections especially, and at all other times publishes only information which serves a handful of "elite". They want candidates to represent themselves without the boost provided by media bias, from a fixed money pool drawn from public funds.
4. From this, they hope to accomplish their fourth objective - an honest government that does not go around killing innocent people in foreign nations every time the will of the "elite" banking cabal is not served to it's extreme desire while robbing the people of their taxes and future to fund elite cronies in their financial scams. They do not want world government, this movement clearly sees the value in maintaining national soverignty. They want the old America back.
5. They want an end to the police state, over excessive law enforcement, government snooping in the electronic arena, de-criminalization of victimless activities, such as adding onto a home without a permit, running a generator without a permit, growing food without a permit, as well as the legalization of hemp. They would like to see the end of America's absolutely monstrous prison system which is mostly full of people who never actually did anything other than violate a law or ordinance which bans an activity that never involved anyone other than the individual performing the action. They believe prison should be for theives, rapists and murderers, and that it is impossible to deserve arrest for inaction, or action which involved no one else.
6. They want accountability for ALL corporations producing genetically modified foods, and focus especially on Monsanto. They want labeling of genetically modified foods to be MANDATORY, and an end to genetic modification altogether
There are also many affinity groups, such as animal rights, gay rights, women's rights, openly communist or socialist groups and trade unions, who have little to no representation (single tents) placed in prominent locations, the remaining 95 percent of the movement stands for what is listed above. The site politics/CIA, infighting, ect will be discussed farther down the page. Overall the movement is composed of excellent people who seem to be defeating the odds.
more here
"Hmmm... How do I blame it on Bush, Republicans, Tea Party and so forth? Come on my prompter, show me a clue."
Not a peep from CNN, MSNBC, ABC, NBC, CBS or any of the lamestream media except for the financial news outlets. Solyndra has been swept under the rug already. So has fast and furious. Obowow's media lackeys are pathetic and choose to sink with the ship rather than report the news
To wit: Mum's the word from former neighbor and just as liberal Democrat, the reprobate Jim Cramer.
But then again, Cramer had nothing to say when his "best buddy and pal" Eliott Spitzer went down ( in both the literal and figurative sense ).
The media fawns may circle the wagons of silence round Corzine, but I do believe he I'll be the one who will be sacrificed upon the scales of justice by his ( former) political colleagues...in the Executive Branch. FBI involvement makes this essentially a foregone conclusion.
There will be a perp walk. And it will be a duesy.
He still might.
"Corzine would have made a great treasury secretary"
whaddya mean "would have" ..........FIRE GEITHNER
CORZINE FOR SEC TREAS !!
Congress will understand that everyone makes a mistake now and then......a la Turbo Timmy -- he worked out OK right ?
no Freudian confessions, please. There are thought police around, dontchaknow.
This "Emperor story" just posted in FT on Corzine. British clever and worth a read. http://www.ft.com/cms/s/0/2975a480-0545-11e1-b8f4-00144feabdc0.html
That there is the funniest shit I've read in months! Thanks for posting1
America is run by the mob and if you are in the family you do not go to jail , anyway do you really think TPTB give a shit about the people that lost money, they can do WHATEVER they want and nobody is going to stop them so shut up and get back to work so they can spend your tax money and carry on living the life of kings whilst you take a big bite of there shit sandwhich
If it is rich people's money then "they" do care: Bernie Madoff went to jail.
Hard for me to sympathize with these people sometimes. I wouldn't pay someone to think for me, which is basically what you're doing when you pay a fiduciary or money manager.
OPM is a helliuva drug.
Other People's Money is a hell of a drugDoesn't "Corzine" sound like a drug name?
When is a diet pill worth $130 a bottle? When it works. Introducing Corzine, the FAST weight-loss pill! Side-effects include:
Jena below posted a version of Corzine the drug, too.
Yes and no. This is a major big deal but post Obama there are no laws. Yeah it sucked pre-Obama but at least we sort of pretended there were laws.
The system is totally corrupt but when people put money in a brokerage account like this - it is supposed to be separate with a custodian never to be touched or stolen. Corzine and the whole exec teams should get 30 years in prison. The "mistake" will be magically fixed.
Elections have consequences.
There is no such thing as fiduciary responsibility any more.
The fact that these kinds of things are not bringing in the guys with guns and badges is becoming a criminal act in and of itself.
Washington ... if you can't find somebody to go to jail over this then maybe we need to start investigating Washington.
A rope is too good for'em.
And to think my little peon workers get arrested because they don't have proof of insurance.
There is no fiduciary responsiblilty to not steal from your customers segregated accounts.
Ok Western. Please go & get some help before returning here...honest to god
Greetings! I'm just back from vaction. I have most of my net worth with MF global...whats this? you're glad you're not a customer; why has something bad happened?
Yeh, you posted again...asstroll
I'm guessing you just had your shirt handed to you with this, so I don't really need to come back with an insult...I'll leave it simply with HAHAHAHAHAHAHAHAHAHHAHAHHHHHHHHHHHAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAHZHAHAHAHAHAHAHAHAHAHAHAHHAHAHAHAHHAHAHAHHAHAHAHAHAHAHAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA!!!!!!!!!!
Fckg Douchebag. No you cretin no exposure & take cretin as a compliment not an insult. Did you give yourself a green or what? Listen up & listen good - a lot of people take positions in attempt to hedge themselves against outright debasement or perhaps cover themselves in positions taken out a while ago. Is it funny that they could be victims of the latest scam? Do I hear no? Ok. So these people could have been smarter & looked at counterparty risks etc, but is this a reason to laugh at them Psychocunt?
I often fantasize about shooting people like John Corzine in the head.
After 25 years of Military service I can't even begin to calculate the number of people to which I am directly and/or indirectly involved with the termination of their life. Adding one more would be of no consequence to my current mental condition. I would happily volunteer to be John Corzine's executioner. I would not even wear an executioners head covering if his execution was made a public affair.
Have you offered up your services LJS? Amercia could use a new leader?
Western, I understand how you feel but killing is a very bad idea. Better to send them to prison, penniless and disgraced, bunking with butt blaster bubba.
Absolutely. It is better to see them rot (caught or not) than let them feel a martyr. The interent record of these folks, including Paul "The face of Enron" Krugman is never going to go away. Let them stew in it.
If Cozine makes it to a country with a no Extradition policy.
I think that's a strong signal 2012 is less than 2 months away.....
ARMAGEDDON GAME ON!
I thought his nickname was "the villages"
They will fix it, just an accounting error, that whole debit and credit thing is very tricky, just ask any college freshman
Are you thinking that a good German accountant could potentially find 55Billion on the other side of the ledger somewhere?
Only if he works for Price Waterhouse + Coopers !
It was hidden under the wiener schnitzel he left on the ledger book.
not to worry. the treasury has the clients' backs. americans will reimburse them for the theft by MF and then let the entire executive team go. some middle manager going down and going to be raped repeatedly in prison though.
as simple as making a wrong input on turbo tax software.
Someone in accounting forgot to carry the 1.
of course they will fix it. No financial loss, no crime. No crime, no criminals.
12.1 million pays for a lot of campaign donations.
You mean he bought a pardon? Say it ain't so!
Yes, an accounting "glitch" the German government had borrowed and has yet to give back.
Wait a minute, let me just Dr Cash and Cr Shareholders Equty... there all fixed, nothing to see here...
Actually the entry will be: Dr Cr
Accounts Receivable-US Treasury $1.5 billion Investor Accounts $1.5 billion
Glitch. Everyone knew about it, it was nothing important.
Why the F - did Judge Glenn Martin give them 8 million to stay in business for 2 more weeks?! So they can shred documents!
The MFs need to go to jail immedately!
It is a global trend - they did the same when IT-factory (DK) went bust due to massive fraud by key employees: The board got full acces to all the records to do with what they like.
Problem is, the man hiring and supporting Stein Bagger (the main fraud) when questions were raised was the head of the board, Asger Jensby, a person who have a history of problems keeping his personal economy away from the that of the business. Jensby got 40 days for tax fraud.
The serious fraud office (bagmandspolitiet) basically excluded Jensby from any investigation and even let him handle the potential evidence.
It's not theft when you're doing "God's Work".
EVERY MF employee aware that funds were being commingled -- and didn't tip off the regulators -- is a COWARDLY CRIMINAL - EVERY DAMN ONE!!
Doesn't matter if they weren't a manager or exec - they are all registered reps and they all know better. Fucking COWARDLY SCUM !!
Expect to see a couple of Indian nationals in the next "high profile" perp (sacrifical lamb) walk as the boys at the SEC high-five each other for a job well done.
Owwww the ass raping, owww. I am sorry for the clients that are sitting out there in WTF land right now.
'I am sorry for the clients that are sitting out there in WTF land right now.'
Really?!
You say this based on what? Are they folks who "deserve" to be robbed?
Certainly not deserving. I'm just wondering who these 'folks' are. Savvy investors no question.
I'm one of their clients; I use a futures account for my business (a family owned business); we tried to wire $ out of MF last week and were given the slow-roll on doing the wire. So now we are trapped there. We work 14 hour days and are honest people. I'm not there gambling like some big hitter. You might have scrap metal dealers who need to hedge copper. Or confection producers who need to hedge the price of chocolate. Or trucking companies who need to hedge fuel costs, etc.
damn that is fucked up. good luck. makes you wonder how systemic this fraud is.
well, Corzine was Goldman CEO, US Senator, Governor of NJ how much can someone accomplish in his lifetime ...these are the pillars of the society ... i can understand Bernie Maddoff stealing but someone like Corzine ? you dont know anymore what and whom to trust ? really i mean it ...
You forgot to mention Democrat also.
>> You forgot to mention Democrat
So you're implying a Republican would never do this?
@ Firing Pin
It's hard working honest people like you that are prime grade-a meat for the vampire squids out there. You've got to wise up. If you see the name Goldman Sachs anywhere within a 50 mile radius of the Firm you are thinking about doing business with, I think you should run as fast as you can in the other direction. It's like the scorpion and the frog. The scorpion just couldn't help himself. He's a scorpion.
Careless Whisper, you can't go anywhere...the whole system is corrupt. Where can you bank? Bank of America? Chase? Where can you have a trading account? Almost every brokerage and futures firm is associated with, populated by, or run by an ex GS, JPM, etc., either on the board of directors, or somewhere in the firm. I tried to eject out of MF the week before they went BK...my wire was never processed. You're right about the scorpion. The greedy bankers can't help themselves. I think MF was blown up on purpose so other big-boy banks could divy up the leftovers for pennies on the dollar. Knowing that Corzine was in "in-the-know" circles, I find it highly unlikely that he would have made such a ham-fisted trade as going all-in on European debt. Even a 23 year old broker could see that this was a bad "investment." Speaking of the MF execs, where are they? Has anyone seen them on t.v.? Are they being given time to hide their assets before the perp walk? WTF?
Careless Whisper, you can't go anywhere...the whole system is corrupt. Where can you bank? Bank of America? Chase? Where can you have a trading account? Almost every brokerage and futures firm is associated with, populated by, or run by an ex GS, JPM, etc., either on the board of directors, or somewhere in the firm. I tried to eject out of MF the week before they went BK...my wire was never processed. You're right about the scorpion. The greedy bankers can't help themselves. I think MF was blown up on purpose so other big-boy banks could divy up the leftovers for pennies on the dollar. Knowing that Corzine was in "in-the-know" circles, I find it highly unlikely that he would have made such a ham-fisted trade as going all-in on European debt. Even a 23 year old broker could see that this was a bad "investment." Speaking of the MF execs, where are they? Has anyone seen them on t.v.? Are they being given time to hide their assets before the perp walk? WTF?
Give it a rest and wake up to the fact that it makes no difference which party they send most of their bribe money to. Crooks are crooks, but the party game keeps us divided while they continue to loot. It simply is not helpful.
You also forgot to mention future convicted felon.
Wow...you are so far behind I don't see you ever catching up. Just sayin. Goldman not stealing from their own clients? Really? Senators and Governors "pillars of the society"? Really? You do realize that this is not 1950?
I caught the Goldman soucks comment also . My taxes go up every year while my property value goes down . I pay to a county that was defrauded by Goldmans' ABACUS fraud . Instutional investors =Muni gov ,pensions ,charities, school districs ect .
That's exactly the point some have been trying to convey here at Zerohedge for some time now. Why is this such a surprise to everyone?
Firing
You have to understand most of these posting anymore wouldn't have 10 bucks to place in an account in the first place.
Sorry to hear you are impacted.
Do you only the funds in cash or also your options?
Aren't personal? They just keep them, don't own them.
Maybe try to lookup the main shareholders and sue them?
Feel for you, Pin. Maybe there will be a transfer from the Fed's balance sheet to yours.
I have a MF account. Was Lind-Waldock. It has been mayhem since Friday. Liquidation trades only. Money is frozen, you cannot transfer. The MF employees have no idea what is going on.
That's unfortunate. Good luck.
BTW, there is no SIPC coverage for futures accounts...because client funds are supposed to be segregated from the firm's funds...so if the firm goes under your money is supposed to be there and you can transfer out or eventually get it. Obviously this isn't the case at MF Global.
Understood. I am glad you were kind enough to enlighten me, my apology if my commentary was callous.
Appreciate the sentiments. Have a good day.
So far I have seen two victims here re MF Global. I really wish ALL of you the best of luck.
Jon Corzine: Biggest POS on planet Earth!
Corzine is worth $300 million. Why not comingle his personal funds with those accounts that were stolen. That would begin to repay some of those who he robbed. In a real hard time, ass pounding prison, the money won't do him much good anyway.
Excellent idea!
That is just wrong! I feel for you. Reminds me of the 401-k's sell off, and the Mutual Fund debacle.
Tylers a little help? Update. We all know this crap has been happening from 07, and it sucks. I have always managed my money.
The guy or gal that trusts a fINANCIAL PONZI SCAMMER GOT HOSED! tHEY HAVE KIDS AND A GOOD JOB, BASED ON THE PRETENSE OF A fUTURE!
cALL ME A WHINER! That is some people being screwed over.
I would drive over to Corzine's house and start cleaning it out.