MF Global's Missing Cash May Be Gone Forever

Corzine company's trades may have 'vaporized' more than $1B
By Matt Cantor,  Newser User
Posted Jan 30, 2012 1:09 PM CST
FILE - In this Dec. 15, 2011 file photo, former MF Global Holdings Ltd. Chairman and Chief Executive Officer Jon Corzine testifies on Capitol Hill in Washingto, before the House Financial Services Committee.   (AP Photo/Susan Walsh, File)

(Newser) – As officials search for the remainder of missing MF Global cash—which one insider puts at more than $1 billion—some are starting to fear the worst. In the words of one source to the Wall Street Journal: A "significant amount" of the money could have "vaporized," impossible to track through various trades and exchanges. One theory gaining traction: MF Global workers pulled cash from a "customer segregated account" meant to remain separate from the firm's assets.

Workers may have used the funds to protect the company as worries over its finances mounted. Alternatively, the company's investments of customer cash may have been hit hard by losses. A large portion of MF Global's money moved through banks and partners who now say they don't hold any of the missing cash. While some $5.3 billion of the $6 billion allegedly on hand at the time of the bankruptcy has been recovered, much of that is tied up in litigation—so the missing figure could be as much as $1.2 billion, according to one bankruptcy trustee. Click through for more on the search, or more on MF Global's collapse. (Read more MF Global stories.)

My Take on This Story
Show results without voting  |