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Federal Court Approves $100 Million MF Global Fine

A US Federal Court has approved the settlement agreed between the Commodity Futures Trading Commission (CFTC) and MF Global Holdings (MFGH) that will see the former FCM pay a $100 million fine and pay $1.2 billion in restitution to former clients.

A substantial portion of this restitution obligation has already been paid by MF Global Inc, another unit of the company. The $100 million civil monetary penalty imposed on MFGH is to be paid once other creditors entitled to priority under US bankruptcy law have been fully paid.

The settlement was agreed after the CFTC charged MF Global with unlawful use of customer segregated funds when the company went bankrupt in October 2011.

The CFTC says that it will continue its litigation against former MF Global CEO, Jon Corzine, and Edith O’Brien, formerly assistant treasurer of the unit that oversaw the funds.

galen@profit-loss.com

Profit & Loss

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