JPMorgan Chase settles with MF Global
Former Gov. Jon Corzine, D-N.J., former chairman and CEO of MF Global, testifies during a House Financial Services Committee Oversight and Investigations Subcommittee hearing on the collapse of MF Global, on Capitol Hill in Washington, D.C. on December 15, 2011.
UPI/Kevin
Dietsch
Published: March. 20, 2013 at 7:51 AM
NEW YORK, March 20 (UPI) -- U.S. clients of failed brokerage MF Global will see a return rate of 93 percent on the dollar for their investments, court trustee James Giddens said.
The rate was boosted this week as JP Morgan Chase agreed to pay $100 million to the firm and return $29 million in funds it had held onto since MF Global declared bankruptcy in 2011, CNNMoney reported Wednesday.
The court appointed trustee, who is charged with recovering funds for clients, has also agreed to release $417 million in funds from JP Morgan Chase that the bank has already returned.
The settlement also boosts the return rate for foreign investors from 75 percent to 82 percent of their investment, Giddens said. The trustee said the settlement with the bank was a better deal for MF Global clients than taking the issue to court.
"This is a favorable and economically sound agreement ending what would have been a costly, protracted, and uncertain legal battle. Without the agreement, additional substantial distributions would have been delayed for at least two or three years," Giddens said.
The firm declared bankruptcy in late 2011 and reportedly lost $1.6 billion in client funds in the weeks leading up to its collapse. About $105 billion in cash was distributed in the firm's final week of business, the trustee has said.
Former New Jersey Gov. Jon Corzine, the firm's top executive, said he had no idea client funds were missing until just before the firm declared bankruptcy. He has repeatedly said he did not direct any misuse of client money.
The firm, however, was using client funds to cover its own obligations, it has been revealed. No criminal charges have yet been filed in the case.
The settlement with JP Morgan Chase is tentative until it is approved by the courts, CNNMoney said.
Former Gov. Jon Corzine, D-N.J., former chairman and CEO of MF Global, testifies during a House Financial Services Committee Oversight and Investigations Subcommittee hearing on the collapse of MF Global, on Capitol Hill in Washington, D.C. on December 15, 2011.
UPI/Kevin
Dietsch
Published: March. 20, 2013 at 7:51 AM
NEW YORK, March 20 (UPI) -- U.S. clients of failed brokerage MF Global will see a return rate of 93 percent on the dollar for their investments, court trustee James Giddens said.
The rate was boosted this week as JP Morgan Chase agreed to pay $100 million to the firm and return $29 million in funds it had held onto since MF Global declared bankruptcy in 2011, CNNMoney reported Wednesday.
The court appointed trustee, who is charged with recovering funds for clients, has also agreed to release $417 million in funds from JP Morgan Chase that the bank has already returned.
The settlement also boosts the return rate for foreign investors from 75 percent to 82 percent of their investment, Giddens said. The trustee said the settlement with the bank was a better deal for MF Global clients than taking the issue to court.
"This is a favorable and economically sound agreement ending what would have been a costly, protracted, and uncertain legal battle. Without the agreement, additional substantial distributions would have been delayed for at least two or three years," Giddens said.
The firm declared bankruptcy in late 2011 and reportedly lost $1.6 billion in client funds in the weeks leading up to its collapse. About $105 billion in cash was distributed in the firm's final week of business, the trustee has said.
Former New Jersey Gov. Jon Corzine, the firm's top executive, said he had no idea client funds were missing until just before the firm declared bankruptcy. He has repeatedly said he did not direct any misuse of client money.
The firm, however, was using client funds to cover its own obligations, it has been revealed. No criminal charges have yet been filed in the case.
The settlement with JP Morgan Chase is tentative until it is approved by the courts, CNNMoney said.