# MF Global Australia - What are you doing?



## sammy84

Just read that MF Global Aus might be going under- 

http://www.theage.com.au/business/local-clients-exit-struggling-mf-global-20111031-1mrog.html

I still have a small account with MF Global which I use mainly to short securities not available on IB. 

What is everyone doing? Has anyone tried to redeem funds lately?


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## Caveroute

*Re: MF Global Aus - what are you doing?*

Yes, the account was locked.

Called etrade - they were looking into it ...............



sammy84 said:


> Just read that MF Global Aus might be going under-
> 
> http://www.theage.com.au/business/local-clients-exit-struggling-mf-global-20111031-1mrog.html
> 
> I still have a small account with MF Global which I use mainly to short securities not available on IB.
> 
> What is everyone doing? Has anyone tried to redeem funds lately?


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## skyQuake

*Re: MF Global Aus - what are you doing?*

They've stopped taking orders on Friday. 
Will have to see if any asset sales eventuate.

Money with them is safe-ish. Its segregated trust account... or so I believe


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## sammy84

*Re: MF Global Aus - what are you doing?*



skyQuake said:


> They've stopped taking orders on Friday.
> Will have to see if any asset sales eventuate.
> 
> Money with them is safe-ish. Its segregated trust account... or so I believe




Orders for funds fund withdrawals or orders to bull/sell CFDs etc?

I remember when I first looked into them their, structure seemed safe, but if that's the case, it is odd if that they are not letting people withdraw.


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## Judd

*Re: MF Global Aus - what are you doing?*



skyQuake said:


> They've stopped taking orders on Friday.
> Will have to see if any asset sales eventuate.
> 
> Money with them is safe-ish. Its segregated trust account... or so I believe




Yes, segregated from the firms account but --- possible crunch time



> According to disclosures accompanying MF Global’s Australian products, all contract-for-difference client funds are pooled together in one account. This potentially exposes one client to the risk of losses for another clients trade. However client funds are not exposed to the firm’s finances.
> 
> Read more: http://www.theage.com.au/business/l...g-mf-global-20111031-1mrog.html#ixzz1cLMRW6Wb


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## el caballo

Just received an email from MF advising not to open any new positions.  They always appeared to be of good "reputational risk", so this is somewhat stunning.  

Let's see what tomorrow brings ...


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## notting

Jon Corzine the US supposed white night ex Goldman has blown it up! 
Shares in MF Global rallied when he first joined. They are now down 80% and counting.


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## skc

I am caught up in this. I still have substantial funds in the account even though I have moved ~90% out last week.

It was pure luck that on Tuesday night I saw the MF share price plummet, read through their announcements and decided to reduce my exposure. I moved ~40% of the idle funds out on Wed. At that stage no one was talking bankruptcy so I only did what was precautionary.

By Wednesday night's session the news were getting worse and I got more worried, and decided to close what I can the following day and get out what I can. Luck would have it that ASX had a fcuking glitch that day... so I wasn't able to close everything until late afternoon. I made the withdrawal request and the money didn't arrive in my bank account until late Friday night. It was a nerve wracking wait.

And through shear bad luck I had margin tied up in a large capital raising position that couldn't be closed out and couldn't be withdrawn... I only do this kind of trades once a blue moon and for this to be tied up just in the wrong time  Now I need to wait for the outcome of the recovery process.

No doubt the mainstream media will have another round of CFD bashing. But this collapse has nothing to do with CFDs. MFG collapsed because of their European debt exposure. And their exposure hasn't even gone bad yet (most debt matures Dec 2012 and is possible that they would get 100c in the dollar thanks to the ESEF) - but with rating downgrade, increasing collateral requirement, lack of trust and everything else, this death spiral played out within a week. And the declining trust from clients means that there were no buyers for even their low risk business units like traditional broking and clearing.

With MFGA CFDs and futures, client moneies are co-mingled in segrgated accounts and there will be deficiencies especially with markets moving today. But I am catiously optimistic that clients should receive the majority of their money back. Both the HKSE and SGX announced yesterday that MFG were still posting up adequate margin for their positions on those exchanges. Given that Comsec, Westpac and ANZ all use MFGA for their CFDs I hope that means the Australian subsidary is also doing the right thing wrt all the monies.  

I am a little shaken by this despite getting most of the money out, and it will be a stressful period waiting for a resolution on the monies still in there. I will probably take some time off to rethink my risk management on who I trust my money with. But the decision to use MFG because it is a listed entity saved my bacon this time, and it will be of the highest priority if I was to trade CFDs again.

Good luck to all account holders and also to the people at MFGA. They have given me good service and they are caught up in this through no fault of their own.


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## el caballo

As SKC mentions, Commsec OTC CFDs uses MF Global as a counterparty.  Hence, when I asked if I could transfer funds out of my Commsec OTC CFDs account this morning, I was told that this is not currently possible and would have to wait for further information.  

I rang MF Global Australia's number this morning and the phone rang out with no answer.

Anyone else with Commsec OTC CFDs?


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## noirua

sammy84 said:


> Just read that MF Global Aus might be going under-
> 
> http://www.theage.com.au/business/local-clients-exit-struggling-mf-global-20111031-1mrog.html
> 
> I still have a small account with MF Global which I use mainly to short securities not available on IB.
> 
> What is everyone doing? Has anyone tried to redeem funds lately?





Yes indeed, MF Global are bust. The UK arm is in administration as well.


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## Nick29

Just received this email for my withdrawal request:

"Your funds are being handled by the administrators as we have filed for bankruptcy. Funds will be returned to you in due course once the administrators have tallied up the books."

Luckily I only have a small amount in there anyway.


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## Sir Osisofliver

Nick29 said:


> Just received this email for my withdrawal request:
> 
> "Your funds are being handled by the administrators as we have filed for bankruptcy. Funds will be returned to you in due course once the administrators have tallied up the books."
> 
> Luckily I only have a small amount in there anyway.




Son of (&*%(^$*%#*^

You go away on holiday without internet or phone connection and..........


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## SilverRanger

Deloitte's been appointed as the administrator. Now let's hope the numbers add up in MFGA's client fund account and we can get a quick resolution. 

http://www.theaustralian.com.au/bus...global-australia/story-fn91v9q3-1226182233481


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## baby_swallow

Back in early 2008, MFG (parent co) was rumoured to be insolvent. The recent Euro crisis is the final nail in the coffin.
Its share price has dropped -65% last week and -96% from 2007 high


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## sammy84

I'm trying to close my remaining positions today and am having no luck. Anyone managed to close out positons?


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## skyQuake

sammy84 said:


> I'm trying to close my remaining positions today and am having no luck. Anyone managed to close out positons?




Doubt you can do trades thru them anymore. You'll prob need to hedge elsewhere


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## baby_swallow

News Flash!!!

"MF floor traders, brokers barred from floor: CME"

http://www.marketwatch.com/story/mf-floor-traders-brokers-barred-from-floor-cme-2011-10-31


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## sammy84

skyQuake said:


> Doubt you can do trades thru them anymore. You'll prob need to hedge elsewhere




That's if I'm hedging against something I even own


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## Sir Osisofliver

Delloite have been appointed administrators and are using Deutche Bank to close out client positions, (And the brokerage has been increased to 25 basis points to do so).

Funds will be sent back to clients at the determination of the administrators.

cheers

Sir O


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## Nick29

sammy84 said:


> I'm trying to close my remaining positions today and am having no luck. Anyone managed to close out positons?




Here's the email of my client adviser there who's responding to my emails: mtaluja@mfglobal.com.


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## skc

Sir Osisofliver said:


> Delloite have been appointed administrators and are using Deutche Bank to close out client positions, (And the brokerage has been increased to 25 basis points to do so).
> 
> Funds will be sent back to clients at the determination of the administrators.
> 
> cheers
> 
> Sir O




Where did you get that info, Sir O?

Do you know when the unwinding will happen? Will they tell you when and at what price the positions are closed out?

How are you affected BTW?


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## skyQuake

skc said:


> Where did you get that info, Sir O?
> 
> Do you know when the unwinding will happen? Will they tell you when and at what price the positions are closed out?
> 
> How are you affected BTW?




Discretionary unwinding


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## Sir Osisofliver

skc said:


> Where did you get that info, Sir O?
> 
> Do you know when the unwinding will happen? Will they tell you when and at what price the positions are closed out?
> 
> How are you affected BTW?




Managed to get through on the phone to one of the Sydney guys. They are a bit in the dark as well so that it not official, but talking to a few other people - no one has been able to close anything, ASX has suspended MF Global trading which is why Deloitte is using Deutche bank.

My exposure across four accounts is +$200

It's out of client hands.  Seems like there is nothing we can do for the moment.  I might live up to my avatar name this afternoon.

Cheers

Sir O


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## skc

Sir Osisofliver said:


> Managed to get through on the phone to one of the Sydney guys. They are a bit in the dark as well so that it not official, but talking to a few other people - no one has been able to close anything, ASX has suspended MF Global trading which is why Deloitte is using Deutche bank.
> 
> My exposure across four accounts is +$200
> 
> It's out of client hands.  Seems like there is nothing we can do for the moment.  I might live up to my avatar name this afternoon.
> 
> Cheers
> 
> Sir O




Thanks. MF uses DB as their hedging party so it makes sense that they are doing the unwinding.


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## baby_swallow

Pretty scary stuff.

What is ASX or ASIC doing ....not informing / advising the investing public.

Most of us here may not be with MF Global, but what if it happened to our current broker? We'll be left in the dark just like MFG clients.


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## mattyhammer

Just a FYI note: I spoke to a contact at MFG just now and once all the positions have been closed (as the administrators have now taken over) the funds will be transferred into your account. Should only be a matter of a few days (I'm thinking a week or two). As long as I get my coins back...all is good. Funny thing was that I closed out all my positions a week or two ago ready to close my account anyway. Just missed!! **** happens.


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## banco

Federal regulators have discovered that hundreds of millions of dollars in customer money have gone missing from MF Global in recent days, prompting an investigation into the company’s operations as it filed for bankruptcy on Monday, according to several people briefed on the matter.



The revelation of the missing money scuttled an 11th hour deal for MF Global to sell a major part of itself to a rival brokerage firm. MF Global, the powerhouse commodities brokerage run by Jon S. Corzine, had staked its survival on completing the deal.

http://dealbook.nytimes.com/2011/10/31/regulators-investigating-mf-global/?hp


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## Nick29

Notice to clients

1 November 2011

Background

On 1 November 2011 at 7:45am, Christopher Robert Campbell, David John Frank Lombe and Vaughan Neil Strawbridge of Deloitte Touche Tohmatsu were appointed as administrators of the following companies (Companies):

    MF Global Australia Limited (Administrators appointed) (ACN 001 662 077) (“MFGA”)
     MF Global Securities Australia Limited (Administrators appointed) (ACN 125 669 801) (“MFGS”)
     Brokerone Pty Limited (Administrators appointed) (ACN 070 037 482) (“Broker”)

The administrators have taken control of the Companies and all of their operations with immediate effect, in accordance with the Corporations Act 2001 (Cth) (Act).

In communications this morning prior to the opening of trading on the Australian Securities Exchange (ASX), the ASX advised the administrators and the Companies that all of the Companies' participations on the ASX have been suspended with effect from the appointment of the administrators. Accordingly, now that they are in administration, none of the Companies have any capacity to trade on the ASX, including to open or close any positions. The ASX have advised us they are in the process of closing out all Australian positions held by the Companies with immediate effect. The ASX has taken this step as a direct consequence of the appointments over the Companies.

Customer positions

We write to provide you with notice to you of certain steps which MFGA and MFGS are taking in relation to open customer positions with effect from our appointment.

    In relation to Australian Equity CFDs, Index CFDs and Commodity CFDs, the counterparty has issued a default notice and advised that it is has closed out all positions it holds. We understand that this process may take a short period of time. The action by the counterparty means that MFGA is no longer able to maintain its hedge position in relation to these CFDs. Therefore MFGA has no alternative but to also close out all CFD positions open, in accordance with the terms of the client agreement between MFGA and the customer. Information from the counterparty close out transactions will be the basis for calculating the MFGA close out transactions.
     In relation to FX CFDs and Margin FX, the administrators are seeking confirmation of the status of MFGA's hedge position, which is with another member of the MF Global group. Should the administrators decide to close out the CFD positions open as at the date of their appointment, in accordance with the terms of the client agreement between MFGA and the customer, affected customers will be notified accordingly. In addition should these counterparties close out these positions then MFGA gives you notice that it will also close out client positions.
    In relation to Australian futures, MFGA's participation of the ASX market, clearing and settlement facilities has been suspended. The ASX has also indicated that it proposes to enforce the powers under their rules to close out or otherwise deal with open positions registered at the clearing facility.
    In relation to overseas futures, the ability for customers to deal in overseas positions will depend upon the extent to which the overseas market, clearing and settlement facilities will allow such activity and position of offshore MF Global Group entities. Should these positions be closed we cannot be certain if or when the funds from the transactions will flow to MFGA. We are hopeful this will become clearer in the near future.
    To the extent that funds are held with offshore MF Global Group entities or at offshore exchanges or clearing facilities, the return of such monies will be subject to relevant arrangements in those jurisdictions. If you have overseas positions you should be aware of these constraints and once more information is available we can possibly provide alternatives for clients.
    In relation to Australian equities, MFGS's participation as a trading participant of ASX has been suspended. No further trades will be executed.

We are now in the process of reviewing all of the companies' information available to us from the records of MFGA and MFGS, with a view to ensuring that customer positions are identified and reconciled. We will write to customers again in due course to advise customers of their position with MFGA and MFGS and amounts payable or receivable by customers of those companies. It may take time for the administrators to be able to confirm the position and, in due course, to process appropriate payments to customers.

In the interim, the administrators are not in a position to adopt or to take any other steps to perform any obligations of MFGA or MFGS under any agreements with customers or other parties, or to open any new trades.

We will keep you and other parties involved in the administrations of the Companies informed of developments.
Any queries should in the first instance be run through your normal channels of communication and / or Broker. A dedicated email account for customer queries is now active:

mfgaustralia@deloitte.com.au

Yours sincerely,



Christopher Campbell, David Lombe and Vaughan Strawbridge
Joint administrators
MF Global Australia Limited (administrators appointed)
MF Global Securities Australia Limited (administrators appointed)
Brokerone Pty Limited (Administrators appointed)


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## sammy84

All funds have been accounted for in the Us:

http://www.bloomberg.com/news/2011-...ed-for-lawyer-tells-u-s-bankruptcy-court.html


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## IBTrader

*Interactive Brokers fast tracking all MF Global accounts*



Nick29 said:


> Here's the email of my client adviser there who's responding to my emails: mtaluja@mfglobal.com.




Dear MF Account Holders,
In light of the MF Global events, Interactive Brokers are fast tracking all ex MF accounts. Attached is research article on how MF situation will benefit IB. I look forward to hearing from you (02 8093 7301).


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## McLovin

sammy84 said:


> All funds have been accounted for in the Us:
> 
> http://www.bloomberg.com/news/2011-...ed-for-lawyer-tells-u-s-bankruptcy-court.html




Bit early to be giving it the all clear isn't it?



> MF Global Holdings Ltd. (MF), run by former New Jersey governor and Goldman Sachs Group Inc. (GS) co- chairman Jon Corzine, has accounted for all its customer funds, *said Kenneth Ziman, a lawyer for MF Global, citing the company’s management*.


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## Nick29

sammy84 said:


> All funds have been accounted for in the Us:
> 
> http://www.bloomberg.com/news/2011-...ed-for-lawyer-tells-u-s-bankruptcy-court.html




Wouldn't be so sure yet, that's just what MF Global's lawyer is saying. The SEC and FBI are investigating. 
On a sidenote, I'm thinking they would not have taken money from MF Global Australia Limited segregated accounts, just USA one's?????


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## explod

I think the effects may well be widespread.   Ye ole JPMorgs hey.

http://www.tfmetalsreport.com/blog/2840/mfing-global

The high finance world is corrupt beyond what I could ever have believed a few years back.    Was I wet behind the ears.

Or are we dreaming?


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## Nick29

"The deal to sell the parent company, run by former Goldman Sachs high-flyer Jon Corzine, fell over when it was discovered that $US700 million in client funds might be missing. *That’s still to be confirmed and there’s no evidence yet discovered of similar signs in the Australian arm*.

http://www.businessspectator.com.au...-Perpetu-pd20111102-N7R52?OpenDocument&src=mp


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## notting

Nick29 said:


> On a sidenote, I'm thinking they would not have taken money from MF Global Australia Limited




I tend to agree with this.  It would have been a hush hush 'Lets try this on as a last ditch attempt.'  It would have been right under Corzines nose. He would have known it was illegal and that to request access to international customers accounts would have attracted far too much scrutiny.  It would have become too problematic to bend many international 'bean counter' arms to cover it up even if they had pulled off a miracle trade with all the customers fund.
I'm guess just the US customers would have been compromised.
The question is in the legal owndership of funds.  Do they come under the unbrella of MF Global in the case of Assets.
I highly doubt this because most people would not sign up under those conditions, I think it's illegal any way.


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## banco

Corzine should be swinging from a lamp post whether money is misisng or not.  He ran that company into the ground on his own private frolic.


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## matt07

banco said:


> Corzine should be swinging from a lamp post whether money is misisng or not.  He ran that company into the ground on his own private frolic.




I spoke with MFGA direct. once the accounts have been added up funds will still be frozen until the Prime broker firm (MF GLOBAL U.S) gives the all clear to release funds. If the prime broker is out of pocket they may request funds to be transfered to them (Prime Broker MF Global)
I hope this is not the case as this would prove how disfunctional globalization is.


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## Tanaka

matt07 said:


> I spoke with MFGA direct. once the accounts have been added up funds will still be frozen until the Prime broker firm (MF GLOBAL U.S) gives the all clear to release funds. If the prime broker is out of pocket they may request funds to be transfered to them (Prime Broker MF Global)
> I hope this is not the case as this would prove how disfunctional globalization is.




I skimmed through the whole PDS when I opened an account with them years ago. I remember thinking well 'Etrade' recommend them and they handle money in "segregated" accounts must be safe... hmmm... naive me … Anyway I have a small holding with them, no open positions as I was on holidays. On second look at PDS “…_For these reasons you are exposed to the risk that you may not receive all money to which you are entitled if there is a deficit in the client money account and MFGA becomes insolvent or is otherwise unable to pay any amount owing to you._”

So yeah we don’t get money back if the Prime Broker says so… nasty… I’ll be watching with nervous anticipation.


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## Nick29

Open positions

"Dear Futures Client,

MF Global Australia Limited (administrators appointed)

We refer to your futures trading account with MF Global Australia Limited (administrators appointed) (MFGA).

Since their appointment at 7:45am on 1 November 2011, the administrators of MFGA have been reviewing the approximately 20,700 client account records held by MFGA and hundreds of client communication and queries that have been received.

Due to the appointment of administrators, MFGA has not been in a position to action any instructions received from futures clients to date. This communication confirms to futures clients how MFGA intends to process instructions from them.

Whilst MFGA will not accept instructions to open any new futures or options positions, MFGA will accept instructions to close (or arrange the closure) or transfer (or arrange the transfer) of existing positions.

If you wish to give MFGA instructions in relation to any open futures positions you have through MFGA, or have already issued instructions, please send or confirm your instructions by email to trade@mfglobal.com.au. Please note you are required to re-issue any instructions issued prior to the time at which this notice has been sent.

Neither MFGA nor the administrators warrant, undertake or represent in any way that MFGA will be able to give effect to your instructions, or that the administrators can take any steps to perform any obligations of MFGA in connection with your futures trading account with MFGA. Relevantly:

1. In relation to ASX24 futures positions:

(a) MFGA's trading participation has been suspended by Australian Securities Exchange Limited (ASX).

(b) All futures positions are registered with ASX Clear (Futures) Pty Limited (ASX Clear) in the name of the clearing participant, MF Global UK Limited (administrators appointed) (MFUK).

(c) ASX Clear has also suspended the clearing participation of MFUK and has declared an event of default and under the rules of ASX Clear has appointed a default broker to manage the positions of MFUK.

(d) ASX Clear has advised MFGA�s administrators that it has taken steps to close out all open positions and that the majority of positions have already been closed.

(e) MFGA is awaiting confirmation from ASX Clear regarding the actions that it has taken and will allocate MFGA�s records and the client monies held by it as soon as practicable after ASX Clear has provided the relevant information to MFGA.

(f) In view of the advice from ASX Clear to MFGA�s administrators outlined above, MFGA�s administrators recommend that clients proceed on the basis that their positions have been closed.

2. In relation to positions on overseas exchanges, MFGA will endeavour to arrange for the execution of such instructions through the relevant offshore broker or clearing participant at the relevant exchange. However, please note:

(a) In many cases the offshore broker or clearing participant is a member of the MF Global group of companies which have, subsequent to the appointment of MFGA's administrators, entered applicable insolvency procedures in their jurisdictions.

(b) Accordingly, MFGA's ability to execute close out instructions or to arrange for the relevant clearing participant to transfer positions is subject to the laws and rules applicable in foreign jurisdictions and the ability of offshore entities, and their relevant controllers, to give effect to the instructions.

(c) That situation is continuing to evolve as the administrators liaise with the relevant parties and decision-makers located overseas.

3. Any instruction to MFGA to arrange for the transfer of positions to another clearing participant should be accompanied with full details of the positions and the other clearing participant, so that such instructions can be communicated to the relevant offshore participant or administrator of that participant.

4. Neither MFGA nor its administrators accept any responsibility for any delay or failure by any third party in relation to the execution, delay or failure in the execution of your instructions including, without limitation, any executing broker, clearing participant, settlement participant, external administrators, exchanges or clearing house.

5. Neither MFGA nor the administrators warrant, undertake or represent in any way that any funds realised through the close out of any positions will in fact be received by MFGA, or when such funds might be received (if at all). The flow of funds to MFGA may be affected by insolvency or other procedures in offshore jurisdictions or in Australia.

Before the administrators of MFGA act on any instructions, the administrators may require as a condition of MFGA taking any steps to give effect to those instructions, clients to agree to separate conditions.

The administrators of MFGA will provide further updates to clients as soon as it is practicable to do so.

Christopher Campbell
Joint administrator
MF Global Australia Limited (administrators appointed)"


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## Nick29

matt07 said:


> I spoke with MFGA direct. once the accounts have been added up funds will still be frozen until the Prime broker firm (MF GLOBAL U.S) gives the all clear to release funds. If the prime broker is out of pocket they may request funds to be transfered to them (Prime Broker MF Global)
> I hope this is not the case as this would prove how disfunctional globalization is.




How can the prime broker request money from segregated Australian accounts?


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## matt07

Nick29 said:


> How can the prime broker request money from segregated Australian accounts?




I phoned MFGA which can still be contacted on 1800 626 099 I was told that the australian arm was successful, however clients funds all depend on the decision the prime broker makes.
The big problem is that we dont know the position of MFGA hedge position when they were forced to close positions.


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## Nick29

Nick29 said:


> How can the prime broker request money from segregated Australian accounts?




Also I don't see how a bankrupt US company has jurisdiction over an Australian company that's under the domain of the ASIC.


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## Nick29

matt07 said:


> I phoned MFGA which can still be contacted on 1800 626 099 I was told that the australian arm was successful, however clients funds all depend on the decision the prime broker makes.
> The big problem is that we dont know the position of MFGA hedge position when they were forced to close positions.




I think there is a difference between CFD accounts and futures accounts. Futures accounts are segregated so it's not there money in the first place. Deloitte have control of that. From memory I think CFD accounts are not segregated although I'm not totally sure.


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## matt07

Nick29 said:


> Also I don't see how a bankrupt US company has jurisdiction over an Australian company that's under the domain of the ASIC.




Totally agree...

Just spoke with MFGA clients expect email in about 30mins


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## matt07

matt07 said:


> Totally agree...
> 
> Just spoke with MFGA clients expect email in about 30mins




Still awaiting email. Just spoke with service provider, they confirmed a conversation with MFGA Adminastrators this morning.

monies showing in your service providers account should be correct. and the administrators still will not give a specific time frame on when funds will be released.


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## pixel

from Tuesday's SMH:







> Clients of three Australian companies linked to struggling US brokerage  MF Global Holdings will this week receive notices of the closing out of  their trading positions after voluntary administrators were called in.



full text at http://news.smh.com.au/breaking-news-business/mf-global-administrators-called-in-20111101-1mtpj.html


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## matt07

pixel said:


> from Tuesday's SMH:
> full text at http://news.smh.com.au/breaking-news-business/mf-global-administrators-called-in-20111101-1mtpj.html




At least the phone is getting answered here in australia..... some reports from america that 30,000 screaming customers making frantic calls and only 5 admin staff answering the calls MF Global.


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## Sir Osisofliver

> _The administrators commenced their investigations shortly after their appointment at 7:45am on 1 November 2011. From their investigations to date, it is apparent to the administrators that the affairs of the companies in the MF Global group are complex and the administrators' investigations may take some time.
> The administrators will keep all clients and other counterparties informed of developments.
> The first meeting of the creditors of the MF Global group companies is expected to be held on Thursday 10 November 2011 in Sydney. The administrators will confirm the meeting details in accordance with the Corporations Act 2001 (Cth) (Corporations Act) shortly. The administrators will provide a detailed report into their investigations to date at that meeting.
> In the interim, the administrators have received a large number of queries from clients and other concerned parties. The purpose of this document is to provide answers to the key queries which have been raised for the benefit of all concerned in the administrations of the MF Global group companies._




Full text http://www.deloitte.com/view/en_AU/...ation/businessesunderadmin/mfglobal/index.htm

Cheers 
Sir O


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## skc

Mildly positive news.



> THE Australian arm of failed broker MF Global was in the black when its directors pulled the plug, the administrator says.
> 
> But Chris Campbell, of Deloitte, said he was unable to guarantee that clients would get 100 ¢ in the dollar because he had yet to secure funds caught up in the group's complex global web.
> 
> He said the company had 20,700 client accounts, although ''people will have multiple accounts'', and he had so far secured ''just under $160 million'' in cash.
> Advertisement: Story continues below
> 
> ''The overall reconciliation that the company did every day prior to our appointment, and is being updated for the day of our appointment, shows a positive reconciliation.
> 
> ''In other words, there is a surplus in total.''
> 
> Read more: http://www.smh.com.au/business/mf-g...full-return-20111103-1mxta.html#ixzz1cgP4HhmG


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## captain black

Some more mildly positive news:



> The administrators of MF Global’s Australian business, *Deloitte*,  say they’ve been contacted by a number of interested local and  international parties about its domestic business, according to the _Australian Financial Review_.





http://www.businessspectator.com.au...up-Rio-Tinto-Ex-pd20111104-N9R6C?OpenDocument


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## captain black

A sale of the entire Asian operations (including Australia) is looking to be on the cards at the moment. 

http://in.reuters.com/article/2011/11/04/idINIndia-60314520111104


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## captain black

Oops, that was the Reuter's India link I posted, the US site has some extra info.

http://www.reuters.com/article/2011/11/04/us-mfglobal-asia-idUSTRE7A30NM20111104


----------



## notting

Some may find this attachment useful with regard to the restricted funds held in MF Global accounts.
	

		
			
		

		
	

View attachment MF Global.txt


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## tollbridge

I was up at night trading when the events all unfolded overseas and was horrifed at the announcement as I trade FX and CFDs full-time as a career. Unfortunately this is a sad example of what can happen to traders who utilise CFD providers. I really hope that everyone receives their money back in full and as soon as posssible. 

This should be a huge lesson to all involved in trading derivatives:

1. Don't get sentimental with a provider - at the end of the day they are in business because of us.

2. Transfer money out on a regular basis - when I decided to commence trading full-time I set up a business, received an ABN and opened up a business account with the CBA. Each day I transfer all profit out of my client account into my business account leaving only a small amount of capital for the following days trading activities. If I need more I simply deposit it in online instantly. There's really no excuse for having money "sit" in a providers client account not doing anything.

3. Regardless of all of the above, by its very nature trading leveraged instruments involves a significant amonut of risk. To be 100% safe, only put in your client account what you can afford to loose.

4. If this can happen to MF Global, it can certainly happen to other smaller firms. Look for "big" providers. There is only one CFD / FX provider in Australia that 100% uses it's own money for hedging and 100% segregates clients funds in a separate Australian bank account(1). Look for sneaky terms in a providers PDS. Reference to a segregated account when required by The Corporations Act *does not mean* a provider is doing it out of goodwill. In the case of MF Global Australia, page 2 of their most recent PDS issued on 1 October 2010 states clearly:

_"It is therefore important for you to note that even though your money may be paid into one or more segregated accounts, this may not afford you absolute protection. First, within the segregated account, all client funds are pooled together and so an individual client balance may not be protected if there is a default in the overall segregated account balance. Secondly, if you have incurred Margin obligations to MFGA, your client funds will be paid to MFGA to meet those obligations. Thirdly, to the extent that MFGA has used client funds to meet obligations incurred by MFGA in respect of its hedging activities referred to above, there is an exposure to counterparty risk in relation to both MFGA and, indirectly, to its Hedge Counterparty, in relation to those funds. For these reasons you are exposed to the risk that you may not receive all money to which you are entitled if there is a deficit in the client money account and MFGA becomes insolvent or is otherwise unable to pay any amount owing to you.
You will receive account statements (see section 7.2 of this PDS). The statement will include information such as cash balances and Free Equity. You should note that a reference to a positive cash balance or positive Free Equity does not mean that MFGA holds all or any of that amount in a segregated account."_(2)

Again let me say how sorry I am to all who have lost money in this crisis. To be honest I thought a lot more people would be on this particular thread and I'm glad to hear that MF Global Australia are at least answering client enquiries and by the sounds of things it looks as if you will be seeing at the very least your initial capital paid back.

(1) http://www.igmarkets.com.au/cfd/strength-security.html
(2) https://invest.etrade.com.au/cms/assets/mfglobal_pds_cfds_october_2010_01.pdf


----------



## noirua

Watch out for any bank, Institution or organisation that is involved directly or however indirectly with Greece, Portugal, Spain or Ireland.
The total Greek  debt sums involved are between $450 - $500 billion.
French debt exceeds $57 billion, Germany $34 billion and UK $14 billion - these are debts owed by Greece and retail banks only.


----------



## garth

I've received an email from Brent Penfold, an Australian newsletter service provider who is also caught up in the MF Global collapse. This reprints his email in full.

Please contact Brent on:

bpenfold@tpg.com.au 

if you wish to be involved in fighting for your money back.

*MF Global Australia’s (MFGA) Demise and Administration

Dear Traders,

First of all this list is a new list I have created from my contacts for the sole purpose of distributing communication concerning MF Global Australia’s (MFGA) demise and administration.

If you would not like to receive these “MFGA” emails then please elect to unsubscribe from this new list of mine at the bottom of this email.

… if you are interested then please read on ….

If you are either a direct MFGA account holder, either through a futures, CFD, forex account etc, or an indirect account holder through third party brokers who used MFGA like E-Trade etc …. and just as importantly … if you are either a trader with another broker or a client advisor or even an ex-MFGA client advisor and therefore part of our wider trader community and who are interested in helping to ensure a good outcome for us MFGA client customers …. then please keep reading as I’d like to request your help … where you can provide it.


Vote to Remove Greedy Deloitte as Joint Administrators
In a nut shell I’d like to request your help to encourage as many MFGA account holders who still have money tied up with MFGA like me to attend Friday’s creditors meeting and vote to REMOVE Deloitte as the Joint Administrators.

I say this as they are estimating their fee for the first month of “administration” at being $1,100,000!

If you can attend the meeting it's being held this Friday 11 November 2011 at 10.30am at the Sofitel Sydney Wentworth, Main Ballroom, 61-10 Phillip St, Sydney NSW 2000.


My Personal Situation
Before MFGA fell over I traded with two futures brokers.

At MFGA I held (and I still hold) three accounts that between them have over AUD166,000 in funds.

Since the 28th October the accounts have not held any open positions.

While the funds are frozen the Administrators continue to earn interest at my pleasure and I’m unable to access them. You, like me, would be understandably upset with this situation.

And talk about maximum adversity, I’ve just learnt that overnight Moody’s in the US have placed my other broker on a credit rate watch for a possible downgrade! Gee ..I can’t seem to win a trick! (


Are Customers Also Creditors?
I have received a number of emails enquiring whether I would be attending the creditors meeting next Friday in Sydney. I replied that no I wouldn’t be as I considered myself a “customer” and not a “creditor”.

But that got me thinking.

On Friday, like every other MFGA account holder, I received a barrage of emails, enough to make my eyes glaze over. After receiving these emails I read over them a second time and could not find a clear instruction from Deloitte, the Administrators, about clearly defining what a “customer” should do?

This made me suspicious.

I wasn’t totally convinced I was a creditor and that I should attend the meeting however I was disappointed there was no communiquÃ© that said …”…if you are a client there is nothing for you to do at this time but wait until our next contact…”.


Greedy Deloitte’s Fee: $1,100,000 per month or $55,000 per Day
Anyway I kept reading the emails and came across “Initial Remuneration Advice to Creditors” with Chris Campbell’s (one of Deloitte’s Administrators) saying…..

“ …My best estimate for my remuneration for the first month of the administration could be in the vicinity of $1,000,000 plus GST…..”

My jaw dropped.

$1,100,000 for four weeks work, meaning they believe after one week’s work they are already owed $275,000? …. That’s $55,000 a day!

I then came across their hourly rates …

Partner $650, Senior Manager $525, Manager $370, Senior Analyst $280, Analyst $240, Graduate $185, Support Advanced secretarial skills $185 and Vacationer $185.

And let me convert that to an annual salary, if we assume there are on average 40 hours a week for a 48 week year. That would make1,920 hours.

Partner $1,248,000, Senior Manager $1,008,000, Manager $710,400, Senior Analyst $537,600 Analyst $460,800, Graduate $355,200, Support Advanced secretarial skills $355,200 and Vacationer $355,200.

Well how about that a Vacationer, or an under graduate as they are defined, is being billed out at an annual rate of $355,200! I think that is only a little less then what the Australian Prime Minister is paid and at least she is a fully qualified lawyer!

It’s just staggering, insulting and scandalous that they feel they can freely and shamelessly charge those rates. Simply bewildering, unbelievable and shocking.

So to paint a clearer picture … if I’m seeing this correct Deloitte are estimating that they will be billing over 4 weeks and possibly beyond at $6,875 per hour ($1,100,000 divided by 160 hours in a month). If we total all the hourly rates above for one “Administrative Team” that consists of 8 people their hourly charge is $2,620. To fit that into their $1,100,000 estimated monthly fee which equates to an estimated hourly fee of $6,875 would require 2.6 Administrative Teams or 20.8 people, lets say make it 21 people working full time on the Administration!

Extraordinary.

If there wasn’t a slight to good chance that part of my funds could be used to pay a part or whole of Deloitte’s greedy hourly rates I’d be laughing my head off thinking it was comedy hour or looking at my calendar to make sure it wasn’t the first of April. I’d be thinking these clowns can’t be serious? Surely they can’t be serious in saying they believe an undergraduate is worth $355,200 (on an annual basis) to a successful Administration of MFGA? Surely they can’t be serious in believing creditors would approve such a rort?

But I wasn’t laughing.

For heaven forbid, if account holders (like me) are not assured of receiving 100% of our account balances, then we’ll be chipping in for Deloitte's outrageous and excessive ambush invoicing. Make no mistake. Account holders will be paying if we’re not assured of 100% of our account balances as Administrators are God, Judge and Jury in their own special land of administration …. but only if we let them.


The Penny Drops
And then the penny dropped on possibly why they were so vague about what “clients” should or could do given our situation. On whether or not “clients” should also consider themselves as “creditors”?

And that’s because at the Creditors Meeting on Friday creditors can vote to remove the Joint Administrators from office.

I can imagine that Deloittes would not want their gravy train taken away so quickly.

I can imagine that Deloittes would not want to give every account holder, if indeed clients can be defined as being a “creditor”, the power to vote against their appointment. And that is because there are apparently over 20,000 accounts with MFGA and even when there are multiple account holders like me, I’m sure the net number of account holders would still out number the traditional creditors.


ASIC’s Definition of a Creditor
From ASIC’s website I found the following definition of what is a “creditor”;

You are a creditor of a company if the company owes you money. Usually, a creditor is owed money because they have provided goods or services, or mde loans to the company.

Please refer to;
http://www.asic.gov.au/asic/pdflib.nsf/lookupbyfilename/receivership_guide_for_creditors.pdf/$file/receivership_guide_for_creditors.pdf

Well I suppose our situation isn’t “usual” however I know I’m certainly owed money.*


----------



## garth

*Sonray’s Clients Were Treated as Creditors
And in Sonray’s administration clients were treated as unsecured creditors!

“…Clients who are creditors of Sonray will be able to participate in the voluntary administration process….”

Please refer to;
http://www.ferrierhodgson.com/en/Current Matters/Corporate Recovery Matters/Sonray.aspx

and click on “First Circular to Creditors Published: 25/06/2010”

[For those not familiar with Sonray it was a broker that specialised in online and advisory services in global equities, futures, CFDs and margin foreign exchange. Due to fraudulent activities of senior executives the business was placed in administration in June 2010 and later its chief executive jailed. The Administrator closed all the open positions and froze the accounts of Sonray's 3000+ clients.]

So in Sonray’s administration clients were seen as “creditors”.

Another interesting fact from the same document is the comparison of estimated fees.

In the document you will see Ferrier Hodgson’s estimated fee of being between $300,000 and $400,000 for the whole administration, not just the first month.

What’s interesting is how familiar their respective business were and yet how disparate their estimated fees are.

Sonray and MFGA are very similar as they both dealt in the same financial markets and instruments both locally and internationally. In my mind there are only two differences between MFGA and Sonray. MFGA has more accounts which in today’s electronic world doesn’t mean a proportional increase in fees. The other is that many of MFGA’s international counter parties where also part of the MF Global group. But such differences to my mind don’t suggest or warrant a three fold in estimated fees.


Shame On Deloitte for NOT Clarifying Clients’ Position
This lack of clarity on what clients should be doing and whether or not clients should also see themselves as “creditors” should be enough to disqualify Deloitte as Joint Administrators at Friday’s creditor’s meeting. Shame on them for their clever casualness.


What You Can Do – Vote To Remove Deloitte As Joint Administrators
And this is why I’m sending this email.

If you, like me, believe Deloitte’s extraordinary estimated fee of $1,100,000 per month is excessive, not justified, not commercial and reeks of exploitation and fee gouging.

If you, like me, believe there is a real chance the Administrators will not hesitate to access “client” funds to pay their fees when they discover MFGA net’s equity is not enough to pay their Wall Street invoices.

If you, like me, believe there is a slight chance that the administration could possibly drag out like Sonray’s continuing saga has since June 2010 where Deloitte’s estimated monthly fee will grow beyond to an annual fee of $13,200,000.

If you, like me, have read that apparently MFGA had recently paid a $4m dividend payment to the US implying MFGA’s cupboard would be pretty bear and lean to pay for the Administrators estimate $1,1000,000 monthly fee.

Then you, like me, would be able to see how vulnerable our account balances are to pillaging by Deloitte … because they aren’t going to administer MFGA for free.

If you , like me, would feel more comfortable in supporting a more commercially orientated Administrator and therefore would like to vote to remove Deloitte as the Joint Administrator then please consider taking the following actions.


Identify Yourself as a Creditor - Complete the Informal Proof of Debt Form
If you are an MFGA account holder, ex-client advisor or a traditional creditor or simply someone that MFGA owes money to, then regardless of where you live you must first fill out the “Informal Proof of Debt Form”.

Don’t be casual and believe you’ll be looked after.

Just like in trading, you need to take responsibility for your own destiny and not rely on the favours and goodwill of others.

To do this you’ll need to go to the following link, download and print the pdf which is much clearer then the email they sent out.

https://www.deloitte.com/assets/Dcom-Aus...rs_3_Nov_11.pdf

I suggest you fill out one form for each account you hold and attach a print out of your last trading statement (or pay slip if you’re an ex-client advisor).

And then keep a scan or photocopy for your records (and remember to bring it along if you intend to be at Friday’s creditors meeting).

What they don’t tell you clearly is that we have to lodge our Informal Proof of Debt Form with the Joint Administrators BEFORE the Creditor meeting on Friday 11th November.

So you will need to do this now and mail it on Monday to the following address;

Christopher Campbell
Joint and Several Administrator of MF Global Australia etc
Deliotte Touche Tohmatsu
PO Box N250 Grosvenor Place
Sydney, NSW, 1219.
Australia.

If you’re an MFGA account holder/ex-employee
If you live in Sydney then please consider attending, bringing along your copy of your Informal Proof Of Debt Form and make sure you arrive 45 minutes (9:45am) before the meeting to get yourself marked off and admitted. And when the item comes up for consideration vote for the removal of the Joint Administrators!

If you can’t attend and you’d like a proxy to cast your vote and you haven’t got one then I’ll be happy for you to appoint me as your proxy, as long as you feel comfortable with this. If so then please fill out the “Appointment of Proxy Creditors Meeting” form (and remember you still have to fill out the “Informal Proof of Debt Form”).

You’ll then need to mail the original on Monday as well (along with your Proof of Debt) to;

Christopher Campbell
Joint and Several Administrator of MF Global Australia etc
Deliotte Touche Tohmatsu
PO Box N250 Grosvenor Place
Sydney, NSW, 1219.
Australia.

And it's important for you to mail the proxy to the Administrators as apparently

…”..proxies must be made available to the Joint Administrators..”

If you would like to appoint me your proxy please either scan and email (bpenfold@tpg.com.au) me your proxy or place a copy in the mail also on Monday morning to;

Brent Penfold
70 Kingston Street,
Haberfield, NSW, 2045.
Australia.

If you’re not an MFGA account holder but a friend of the market, either as a trader or client advisor, please forward this email to as many people you know who hold an account with MFGA. Please let them know about Deliotte's planned excessive fees. 

And if us little people are able to make our voices heard at Friday’s creditors meeting and we’re successful in stopping this unsightly stampede to the advisors feeding trough and we halt Deloitte in their tracks then we’ll be able to have a say in the appointment of a more commercially orientated and fair minded Administrator.


Can We Make a Difference?Are Customers Also Creditors?
It all comes down to the question of whether or not clients are also creditors?

In my opinion I think we are.

However I can certainly be wrong.

But as trading successfully and profitably is more about successfully risk management and being a good loser then finding that perfect entry or exit technique …so is the decision we now face.

Do we consider ourselves as just “clients” and do nothing, or take a chance and consider ourselves as “creditors” as well?

I know that filling in the forms and either attending Friday’s creditors meeting or sending in a proxy may turn out to be a waste of time however what is there to lose but a little of our time in our attempt to manage our risk whether they be real or not? And although I’m not a lawyer or anyone familiar with the intricacies of administrations I do know Sonray treated their clients as unsecured creditors and ASIC defines creditors as anyone who is owed money.

My suggestion is to strongly consider erring on the side of conservatism, fill in and lodge the forms and attend or organize a proxy to vote for the removal of Deliotte as Joint Administrators …. the cost to us will only be the time, effort and frustration we put in to getting it done.


Thank You
If you’re still here with me I’d like to extend a big thank you for taking an interest in hearing my thoughts on this matter.

I don’t see myself as an activist however I feel I can’t stand idle and see such a calamity that has fallen upon us MFGA account holders be compounded by the unbridled ambition and greed of Deloitte.

And please remember to unsubscribe from this list (see below) if you would prefer not to receive any MFGA type emails from me.


Some Good News?
And to end by sharing what looks like some promising news … it could just be hopeful speculation but here’s an interesting article at the following link … let’s hope there is some currency to it …. But incase there isn’t … lets aim for removing Deloitte as Joint Administrators at next friday's creditors meeting.

http://www.reuters.com/article/2011/11/05/us-mfglobal-asia-idUSTRE7A40RJ20111105



Yours sincerely.


Brent Penfold
MFGA Account Holder/Creditor
Futures Trader & Adviser
ASIC AFSL No. 225946

bpenfold@tpg.com.au*


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## huyha123

Thanks Ben.

Good luck with the creditor meeting and keep us update as much as you can.


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## banco

There was a Senate inquiry into corporate insolvency in 2010 (hasn't led to any changes).  But the standard MO is for the administrators to take huge fees and to drag it out for years in order to faciltate their feeding on the carcass.  I think Ansett is still being administered.


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## westie

I too have a fair amount of funds tied up in an MF Global client account.  I can also relate to the exorbitant fees that Delloite are proposing to charge.

My only concern here is that the administrators will currently be in negotiation with potential bidders for the remaining business, and by voting Delloite out could jeapordise the success of these opportunities.

Also I have been through an administration process as an employee (Nortel, with EY as administrators) which is still not resolved and know that these fees are not unusual.

I am not decided either way at present so any comments would be appreciated.


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## skc

For some reason I am on Seismo Market Solutions' mailing list, and I replied to their email last week when they ask MFGA CFD clients (of which many of their clients are) to come forward and be kept in the loop. I have copied the Seismo email for everyone's information here. 

Note I am not endorsing Seimos' understanding of the situation or their recommended action. Personally I am filling out the Informal Proof of Debt Form as suggested by Brent Penfold's email.

With regards to voting Deliotte out - I have appointed Brent as my proxy. While I don't believe there will be enough numbers to remove Deliotte (or that Deliotte can actually use client's money to pay themselves), it will at least be a show of force so they know their fees will be scrutinised.


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## skc

Dear MF Global CFD Client,

Many of you have received multiple emails from the MF Global receivers and administrators yesterday.

As a result, Seismo Market Solutions (as a partner of MF Global Australia Ltd) has received large number of email & telephone queries from MF Global clients who are confused by the emails sent, as to what they mean, what exactly they pertain to and what actions to take.

To the best of our understanding, we advise the following:

1.   If you are an MF Global client with a CFD or other account you are NOT a creditor.
     You do not have to open a new MF Global account as implied by the emails you may have received.
    You only need to open a new account if you are a contractor or service provider to MF Global.

2.    Due to the resulting confusion and continuing uncertainty as to the repayment of funds, we recommend that you draft a simple letter of demand to the administrators and send a copy with your latest MF Global CFD account statement attached, requesting full repayment of your funds within 7 days. Send the letter & your statement both by mail & email. We recommend that you do this in addition to any previous emails or correspondence you may have sent. Make sure you note your contact details, your MF Global CFD account details, your account name etc so that it matches the details on your MF Global account statement - to assist the administrators.

3.    In an effort to help all clients who have MF Global accounts, we will be speaking directly with the administrators on Monday Nov 7th 2011 to clarify what exactly is going on and what actions MF Global CFD account clients should take in response to the emails you may have received yesterday. Pending the administrators response, we may notify you in due course (pending their permission for Seismo to do so).

4.    Accordingly, we suggest that you only respond to the 3 x emails regarding creditors, proxies, etc if you fully understand what is required and or you have received instructions on exactly what you are required to do or how to respond from the administrators . If you are unsure on any aspect regarding your funds or any emails received, you should contact the administrators on             02-8273-8851       or             02-9322-7619       and or seek independent legal advice.

5.   It is our understanding only, and based on communications just prior to the administrators being appointed; that MF Global CFD client funds had been returned or were lodged in the MF Global Australia Ltd CFD client segregated account, ready for repayment to clients. We understand that this may not apply to futures or other MF Global accounts.

6.    It is also our understanding that the administrators have to fully reconcile both the cash balance and final closed positions of all MF Global CFD client accounts, before they can make any plans to repay client funds. Final open CFD positions were only closed this week and this had made reconciliation a slow process for the administrators. Seismo will use its best endeavours on Monday to further clarify this with the administrators - if possible.

7.    Due the large number of enquiries Seimo has received, primarily regarding the repayment of client funds by the administrators of MF Global, we understand many clients are seeking independent legal advice as to what protection(s) may apply to their funds as a result of the funds being held in a CSA "client segregated account" with MF Global. We recommend that you take up what level of protection may apply to you, directly with the administrators. Again, Seismo will use its best endeavours to clarify this issue on Monday with the administrators.

We trust this information answers the numerous questions raised by the many MF Global CFD clients who have contacted Seismo since Thursday 27th October, 2011.
.
We ask that you that you contact the administrators directly by email or by phone above from now on regarding your MF Global accounts.
.
We will use our best endeavours to clarify all the above issues with the administrators on Monday and will forward any further information if possible and only if the administrators give us permission to do so.
.
In closing, our thoughts go out to the many hard working staff at MF Global who are dealing with hundreds of enquiries and assisting the administrators as a result of this matter. We offer them our sincere thanks and gratitude on behalf of Seismo and all our clients who are affected by this matter.


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## captain black

Thanks for the info SKC.


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## SilverRanger

http://economictimes.indiatimes.com...d-on-surge-in-offers/articleshow/10630153.cms

Hopefully we can have some good news tonight or tomorrow


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## pixel

Having received CMC's email this morning, I'm feeling heaps better: 


> Dear  Customer [FONT=Arial, Helvetica, sans-serif]As you may be aware, last week  saw a number of press articles referring to recent events in the financial  services market and the issue of client money.[/FONT]
> [FONT=Arial, Helvetica, sans-serif]I would like to take this  opportunity to reassure you that as a customer of CMC Markets all of your funds  are held in a segregated trust account with a top-tier Australian bank,  established, maintained and operated in accordance with Australian Client Money  Rules. This fully segregated model means all client moneys, including client  margins, are 100% segregated.[/FONT]
> [FONT=Arial, Helvetica, sans-serif]We do not use client money to  hedge our positions or to meet the trading obligations of other customers. This  exceeds current regulatory requirements under the Australian Client Money Rules.  This is one of the factors that separates us from smaller providers and offers  you financial security. As a result, you can rest assured that all client funds  are completely secure.[/FONT]
> [FONT=Arial, Helvetica, sans-serif]CMC Markets is regulated in  Australia by ASIC and complies with Australian laws. As a CMC Markets’ customer  you’re partnering with a stable, secure and trustworthy financial services  company and one of the leading CFD providers in the world.[/FONT]
> [FONT=Arial, Helvetica, sans-serif]The fact that we now have a  fully segregated client money model, our global operation is in a strong  financial position and that we have robust internal risk management and  compliance systems, means I can very confidently say to our Australian and New  Zealand customers that in regards to counterparty risk, you have never been more  safe and secure.[/FONT]


----------



## garth

Brent Penfold's recent efforts against the administrators of MF Global, Deloitte Australia, has made the Sydney Morning Herald.

http://news.smh.com.au/breaking-new...-wants-administrators-out-20111107-1n3pk.html


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## tech/a

> The collapse is linked to revelations that chief executive Jon Corzine had gambled and lost on $US6.3 billion ($A6.09 billion) in European bonds




Not good!

If you have 6.9 billion why the hell do you want to risk it???
How much is enough?

Why cant people stick to the business they are in!!

If banks stuck to banking
Govts to Governing
Companies to the fields they have expertise.
Then we wouldnt be in the position we are in!

I dont have any funds with MF.
But are your funds safe ANYWHERE banks included?


----------



## edman79

A couple of questions...

1. There were supposedly between 30 and 50 offers for MF Global Asia before the weekend. If the asian/australian arm is bought out what does that mean for the clients? Will client money be returned?

2. I know its just a guess but what time frame are we talking to get our money (or part there of) back? Are we talking days,weeks or months?


----------



## notting

tech/a said:


> Not good!
> I don’t have any funds with MF.
> But are your funds safe ANYWHERE banks included?



It almost justifies the occupy wall st stuff.

If these cowboys are still capable of doing this  kind of thing after two years of financial hell for most of the western world, then clearly safety of innocents funds is always going to be at risk.  
There is no doubt that computer programs could be created to identify excessive, uncovered risk that could prevent desperate cowboy trades such as Corzine's.

Seems that there is still no will to keep the human cowboy element lassoed even after all these crisis’s.  If there were the political will there would be systems running that would prevent it.  Better get my tent!


----------



## westie

edman79 said:


> A couple of questions...
> 
> 1. There were supposedly between 30 and 50 offers for MF Global Asia before the weekend. If the asian/australian arm is bought out what does that mean for the clients? Will client money be returned?
> 
> 2. I know its just a guess but what time frame are we talking to get our money (or part there of) back? Are we talking days,weeks or months?




Good points edman79 and is one of the questions I sent to Brent as part of the collated questions to be put to Chris Campbell, Administrator.

My feeling here is that there is probably a lot going on behind the scenes that we are not aware of and will hopefully find out when the admistrators are able to disclose.  I'm hoping there will be a quick turnaround on this as its not the sort of business that could sit on the shelf for too long.

I think a sale of these assets would be a very positive outcome for clients of MF Global that still have funds tied.  

Lets just hope they secure a sale quickly.


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## captain black

Latest update on the sale:

http://economictimes.indiatimes.com...ected-by-end-of-week/articleshow/10651484.cms


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## edman79

I agree tech/a - your never 100% safe.

After a few emails to new CFD providers I have come to the conclusion that in the event of bankruptcy/insolvency client money will not be returned to the clients until secured creditors are paid first and the remaining funds (whats left) will be returned to clients. It really doesnt matter how "secure" the account that the money sits in is or how many comforting emails they send you.

My thoughts are that the best way to protect your money would be to have multiple providers with your capital split up so that if one provider goes belly up you dont lose everything.

I would like to hear other suggestions of how I can protect my money so this does not happen again in the future.


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## el caballo

edman79 said:


> My thoughts are that the best way to protect your money would be to have multiple providers with your capital split up so that if one provider goes belly up you dont lose everything.




Unfortunate but probably true.


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## peter2

Client monies are not safeguarded because the regulator couldn't be bothered creating unambiguous and effective rules. I would like to see ASIC get off it's highly paid ar$e and implement rules that protect client monies held by all financial institutions. It's my money and I'll be damned if the administrators have access to it. Client protection should be given the highest priority. Sadly we are not. 

It doesn't matter how morally or legally right a person's complaint is, ASIC will do nothing until 10,000 people complain. It would be good if all the trading account holders complained at the same time. Would this be enough to wake up ASIC? 

And if ASIC is awake how about stopping the insidious practice of sub-licensing FS Licenses. The shadow broking and financial services industry is still ripping people off because ASIC has done nothing to prevent them. 

Unfortunately the Aussie MFGlobal was undermined by another CEO that didn't understand leverage and risk. Good riddance and the parent company deserved to fail. 

(skc: made a good point about doing business with a public company. Anybody could have seen the MFG share price going down over the past few months and taken some preventative measures.)

I don't understand why weren't all client positions closed out immediately. Flatten all positions could have been done within seconds. That's what computerised systems can do. Reconciliation should have also been able to be done within minutes. Checking that the money is in all the bank accounts may have taken another day (or T+3). 

Another example of how the financial services industry treats client accounts. 
ASIC please wake up to your responsibilities.


----------



## Garpal Gumnut

I went to a Seminar on CFD's some years ago and it had some sad people there, commission agents scared of head office with no power, and retirees and fly in out mini millionaires with attitude.

On the one side were the powerless and the other the marks.

I know nothing else about CFD, but if you take my advice on my gut feelings.

Avoid them.

gg


----------



## el caballo

peter2 said:


> I don't understand why weren't all client positions closed out immediately. Flatten all positions could have been done within seconds. That's what computerised systems can do. Reconciliation should have also been able to be done within minutes. Checking that the money is in all the bank accounts may have taken another day (or T+3).




You would think this would be possible given the technology at hand.


----------



## riskapur

It would be worthwhile to look at ASIC Client Money Rules Regulation 7.8.03 (under Australian Corporations Law) and ASIC Client Money Regulatory Guide 212 - Pg 22. It appears from these documents that client balances held with MF Global Australia are held in trust for clients and should be paid to the entitled owner of the accounts before any creditors, secured or unsecured. Please verify for yourselves - the statute and regulatory guide clearly stipulate the order of payment of client money balances in the event that the AFS licensee (in this case MFGA) goes into administration/becomes insolvent. Given the above would holders of client balances with MFGA be defined as "Client Money"? In my opinion, given the above, yes.

In light of the above, perhaps it would not be best for those client who hold balances with MFGA (ie "Client Money") to be defined as creditors? For client balances to be defned as creditors (most unlikely unsecured since we do not hold a charge against company assets) would seem to be in favour of creditors (secured and unsecured) including Deloittes (whose fees are just totally unacceptable) who may then be able to claim seniority over client accounts to get their fees paid from client balances. If possible, it is very worthwhile confirming this with legal counsel. 

My interpretation from the above is that if client balances are held in trust for the owners, then as per the above regulations, no creditor should be allowed to touch them to get their fees paid. 

The main risk for CFD and Margin FX account holders therefore should be (under ridiculous ASIC law that allows client balances to be pooled - not the case with many other reputable exchanges) that some positive client balances may be used to cover shortfall in margin / deficits in other client balances. Futures client balances are controlled by the futures exchange, not MFGA, so hopefully should be intact.

Would be very interested to here other viewpoints on this.


----------



## Nick29

riskapur said:


> It would be worthwhile to look at ASIC Client Money Rules Regulation 7.8.03 (under Australian Corporations Law) and ASIC Client Money Regulatory Guide 212 - Pg 22. It appears from these documents that client balances held with MF Global Australia are held in trust for clients and should be paid to the entitled owner of the accounts before any creditors, secured or unsecured. Please verify for yourselves - the statute and regulatory guide clearly stipulate the order of payment of client money balances in the event that the AFS licensee (in this case MFGA) goes into administration/becomes insolvent. Given the above would holders of client balances with MFGA be defined as "Client Money"? In my opinion, given the above, yes.
> 
> In light of the above, perhaps it would not be best for those client who hold balances with MFGA (ie "Client Money") to be defined as creditors? For client balances to be defned as creditors (most unlikely unsecured since we do not hold a charge against company assets) would seem to be in favour of creditors (secured and unsecured) including Deloittes (whose fees are just totally unacceptable) who may then be able to claim seniority over client accounts to get their fees paid from client balances. If possible, it is very worthwhile confirming this with legal counsel.
> 
> My interpretation from the above is that if client balances are held in trust for the owners, then as per the above regulations, no creditor should be allowed to touch them to get their fees paid.
> 
> The main risk for CFD and Margin FX account holders therefore should be (under ridiculous ASIC law that allows client balances to be pooled - not the case with many other reputable exchanges) that some positive client balances may be used to cover shortfall in margin / deficits in other client balances. Futures client balances are controlled by the futures exchange, not MFGA, so hopefully should be intact.
> 
> Would be very interested to here other viewpoints on this.




Your right, segregated accounts are not MF Global's money to begin with. However judging by this article http://news.smh.com.au/breaking-news...107-1n3pk.html, Deloitte need educating on this point.


----------



## riskapur

Nick29 said:


> Your right, segregated accounts are not MF Global's money to begin with. However judging by this article http://news.smh.com.au/breaking-news...107-1n3pk.html, Deloitte need educating on this point.




I am of the belief that it is in Deloittes and every other creditors interest to have client balances categorised as unsecured creditors - that way they can get their hands on the balances to pay themselves. This does need to be verified by qualified legal counsel, but if my hunch is correct - then all holders of client balances with MFGA should do everything they can to be seen as "client money" - meaning that the funds are held in trust for them and cannot be touched by external creditors, secured or unsecured.


----------



## westie

riskapur said:


> I am of the belief that it is in Deloittes and every other creditors interest to have client balances categorised as unsecured creditors - that way they can get their hands on the balances to pay themselves. This does need to be verified by qualified legal counsel, but if my hunch is correct - then all holders of client balances with MFGA should do everything they can to be seen as "client money" - meaning that the funds are held in trust for them and cannot be touched by external creditors, secured or unsecured.




Thanks riskapur for your information on ASICS rules on client funds.  I have lodge a complaint with ASIC against Deloitte based on this.

Many Thanks


----------



## mrlunch

Ahoy,

I'm caught up in the MF mess along with many others.  I, like others, was concerned about whether or not lodging an informal proof of debt would reduce my rights, especially as I have done this (and Deloitte have recommended doing so via their communications).

I spoke to ASIC first, and they've marked my case as urgent and will get back to me today hopefully.  I said I was concerned our funds might end up paying Deloitte's fees, espeically if we identify ourselves as creditors.

Then I spoke to Deloitte.  They have essentially said whether we fill out the form or not, our entitlements to our money will not change.  However doing so gives us the right to vote at the first creditors meeting.  They said that we (clients) are creditors based simply on the fact that MFGA owes us money.  After thinking about it a bit it did make sense that fillling out that form can not be used to change our legal entitlements to our funds as that would be open to a massive can of worms and deceptive ploys etc.

I probed Deloitte further for timetables and information.  To Deloitte's credit the person I spoke to was quite helpful and did seem to know what they were talking about (you would hope so too given the fees!)  They couldn't give anything concrete (as usual) however they believed a tangible timetable for things such as reconcilliation and paying funds back to clients and so forth was not too far off.  It was hard to guage what this meant exactly, but my feeling was we should have this within weeks.  This was the timetable though - not the funds themselves!

I asked if it could take a year even to receive funds, and they reacted in a manner suggesting it should not take anywhere near that long - but certainly months seemed on the cards.

I also tried to probe about the status closing positions and account reconcilliation.  This affects everyone indirectly as until everything is closed we are all in limbo - my understanding is they won't give anyone anything if there is one position out there unnaccounted for.  Nothing concrete again, but I took from his responses that a very small percentage of positions with some international exchanges were outstanding.  Hopefully this means the risk of losing positions eating into the money is lower.

If there are losing positions I'm not sure who pays though... the wait must be even more nervous for those that don't know if their positions have been closed AND they can see their positions would be losing.

I did feel much better after speaking to them that money is there and coming back at some point.  Though it is part of their job to make me feel better so it has to be taken with a grain of salt.


There is a great insight into market psychology here for all traders that have money with MF.  Stocks and other instruments do not like uncertainty at all, and they generally can't move on while that uncertainty remains.  We MFGA clients are just the same now, with the uncertainty getting to us more than the reality, with every unanswered question playing on our minds.  Figuring out the path forward without knowing if/when we are getting how much money back is difficult.

Hopefully a concrete timetable is issued soon.  The list of questions Brent and Pierre-Francis are putting forward, if all answered, will be most helpful.

Well done to anyone involved that has taken action - it may be for not much in the end but I would kick myself rather hard if it was all over, I lost out and did nothing.


----------



## stockmonster

anyone noticed the forms sent by Deloittes refers to MF Global Australia Limited ACN 001 662 077(tick Box), yet my statement from emidas refers to MF Global Australia Limited ABN 50 001 662, no mention of the ACN. 

I'm wary of legal technicalities and i cannot contact Deloittes by phone and email replies are a just form responses - their service performance(considering their excessive fees)is way below par.


----------



## kpet

Hi 

I have a otc CFD comsec account. Up until today (9/11), I am still unable to get my money out from commsec. Can anyone advise me what is their current situation with commsec otc cfd account? 

I just wonder what right does commsec has in 1. Not releasing our fund which is with commsec, and 2. Close our cfd positions without our consent. Bear in mind that we never trade with mfglobal which is their counterparty, and we opened the account with commsec only.

I would appreciate forum members can shed light onto it.


----------



## riskapur

Please be very careful to check what Deloittes are telling us as account balance holders of MFGA  - they have their own interests to look after first and foremost and that means maximising their fee pay out and getting access to as big a pot of funds as possible to do that.

Deloiitte will say that client balances are creditors - it is in their interest to do so - if this is the case all client balances will be categorised as unsecured creditors and therefore become available to pay secured creditors and also the administrator (being Deloittes) BEFORE giving client balance owners back their money. Just because a client has a deposit balance does NOT always mean they are a creditor. For example if a trust is holding the cash balance on behalf of a client, the client is the benificiary and not a creditor. This generally affords a lot more protection to the beneficiary/client - third party interests will find it much harder to access their cash balances.

From the legal advice I have had to date - and as per Companies Act  S.981 Regulation 7.8.03 - client balances held with MFGA should be seen as being held in trust,  not as creditors as Deloitte might have us believe - simply because it is in their interest to tell us that.

However, please check with independent legal counsel for yourselves to verify if what I am saying is correct


----------



## kpet

el caballo said:


> As SKC mentions, Commsec OTC CFDs uses MF Global as a counterparty.  Hence, when I asked if I could transfer funds out of my Commsec OTC CFDs account this morning, I was told that this is not currently possible and would have to wait for further information.
> 
> I rang MF Global Australia's number this morning and the phone rang out with no answer.
> 
> Anyone else with Commsec OTC CFDs?




I am with Commsec otc cfd. Up till today, I was not able to tranfer funds out. I feel that we should not be penalised as 1.  Our funds are with commsec, 2 we never trade with mfglobal.

Commsec has no right in withholding our fund , and also one-sidedly close out our positions. 

Please give me your thoughts on this and how can we move this forward?


----------



## pifouSyd

To MrLunch: the information I have is consistent with yours.

To all - we are considered a "contingent" creditors.
If all money belonging to the respective segregated accounts can be repatriated to Australia, then, with segragated accounts overall balancing, the money "held in trust" will be returned to account holders. Without us been technically creditors.
If however some money is missing from the segregated account, then all account holders from this segregated account become creditor for the shortfall.

One source of confusion is that being referred to as creditor (or contingent creditor) does not imply that we are considered creditor with respect of the whole account balance, only fo the shortfall. Hope this makes sense.

Because Deloitte can not assess the shortfall until all overseas parties have transferred the funds held, they conservatively consider all of us "contingent" creditors.

For people still hesitating to fill in the Informal Proof of Debt, my recommendation is to go ahead, as it will allow them to participte to the meeting and to vote without affecting their ability to recover their funds (this is a personal opinion, don't quote me on this, I'm not a lawyer or a Insolvency specialist; I am a full-time futures trader, affected like you by the collapse of MF Global; I have been across communications from ASIC and deloitte which confirm MrLunch findings).

PF


----------



## Nick29

The creditors meeting can be viewed online here http://www.brr.com.au/event/89337 at 10.30 today.


----------



## sammy84

And now for some not so great news-

MF Global's local arm lacking information

"Deloitte partner Chris Campbell said the process would take more than three months but less than a year assuming all data was received and reconciled."

http://www.theage.com.au/business/m...information-20111111-1naqt.html#ixzz1dMjZvIuR


----------



## skc

I watched the webcast on the creditors meeting and here are some random thoughts.

Positives:
- It sounds like MFGA is pretty much doing everything above board. There are no missing client money. Indeed there may be small surpluses if all the funds held at counterparties are returned into the system.

- Deloitte is keeping client moneies in separate pools between the different product areas (CFDs, Futures, FX etc). There is a chance that certain type of clients can get their money back sooner if the transactions within that product area are resolved.

- It looks to me that MFGA is a going concern and hopefully will be sold as such. There may be some interests to make client accounts whole from a potential buyer. The buyer may also be in a better position to ask the existing counterparties to expediate the release funds held back to MFGA.

- There seems to be adquate cash at the company level to pay off local staff's redundancy payments. This is important as the staff are vital to helping Deloitte unravel the puzzle. The same goes with other general creditors - there doesn't seem to be much problems there.

- Quite a number of knowledgeable people have volunteed themselves as members of the creditor committee. 

Negatives:
- The counterparties (e.g. Deutche Bank for CFDs and ASX for futures) are not forthcoming with the necessary information in a timely manner. In fact, as Deutche has multiple touchpoints with the MFG globally, they don't seem to want to release the funds in one country if they are going to be short of funds in another country. I am not sure they are legally allowed to do that, but that seems to be a main reason for the holdup. 

- Certain futures counterparties are other entities within MFG who are now also undergoing administration. So the administration process for those entities may prove to be a bottleneck for MFGA's process.

- Some future account holders are putting in claims on market risks experienced because of positions being frozen. These claims (of which I don't know if there are merits or not) will delay the whole process further.

Overall verdict...

The money is probably there, even though much of it is outside the MFGA system (and hence not in the administrator's control). Those counterparties have their own agenda wrt holding onto those cash/information which brings the risk mostly to collection risk.

If clients receive >90% within 6 months that would be an acceptable outcome to me.


----------



## sammy84

SKC thanks for the summary, much appreciated that you took the time to pass this on.


----------



## Trader101

heard that Deutche Bank has some futures account with MF global UK and may file a case using the collateral from clients margin funds (this is not verified) to offset this liability. 
If this is true (i hope it's not true and it doesn't seem to be incharacter with DBA) I think Deutche Bank is playing a very dangerous game here, first the chance of them willing this type of case from my personal view is not too significant. These are AUSTRALIAN client money and have nothing to do with UK holding company is my view.
Secondly I think that DBA would be doing a huge amount of damage to their brand name., which Australia institution would leave fund in DBA or  trade with a DBA counterparty if they are not going to release the fund when there it is needed.
 I think DBA are forgetting that MFGA cfd accounts are used by Commonwealth Bank Clients, Westpac clients, etc and they are effectively damaging their brand in Australia. 
I think the creditor should write to the CEO of Commonwealth Bank, Westpac and any other Australian institution that deals with DBA and advise them of the issue and risks in dealing with DBA. (using this case as an example and using the action of BNY as a contrast)
If this doesn’t there should be a campaign in the media.  Let me know what you think.


----------



## Garpal Gumnut

sammy84 said:


> And now for some not so great news-
> 
> MF Global's local arm lacking information
> 
> "Deloitte partner Chris Campbell said the process would take more than three months but less than a year assuming all data was received and reconciled."
> 
> http://www.theage.com.au/business/m...information-20111111-1naqt.html#ixzz1dMjZvIuR




Lets face it folks, your money is gone.

There is buckleys of you ever getting much if any back, as there is criminality at 3 or 4 levels of separation from you.

It sounds like a Storm Financial Mark2 in a way, litigation is the only option and the lawyers will suck most of it up anyway. The local dealers will fall back on the statements you all signed prior to opening your accounts.

gg


----------



## skc

Garpal Gumnut said:


> Lets face it folks, your money is gone.
> 
> There is buckleys of you ever getting much if any back, as there is criminality at 3 or 4 levels of separation from you.
> 
> It sounds like a Storm Financial Mark2 in a way, litigation is the only option and the lawyers will suck most of it up anyway. The local dealers will fall back on the statements you all signed prior to opening your accounts.
> 
> gg




You have no idea what's going on. The money is there, there are no criminal activities in MFGA and even those at Sonray was able to get 87c in the dollar when the directors there were criminally stealing from client accounts. The ASIC rule of using client segregated account doesn't offer 100% protection, but it does offer some protection unless there is blantant criminal activity (e.g. Sonray or what may be the case with MF in US).

Have a look at the creditor meeting presentation if you are interested in making more informed posts.


----------



## peterfootwork

Just read this one , have a look-http://www.businessweek.com/ap/financialnews/D9QU45E80.htm"], seems like all the clearing houses have the same problems!
I'm also part of this MFG debarcle, and was at the meeting yesterday , I'm no legal eagle , but the process of placing MFGA under admin, seems like the were acting in haste , in not considering closing out clients positions. (at least with the Aussie Exchange products, ASX, SFE, CFD's, and solvent OTC counterparties).
I do understand they may of had thier hands tied, legally, and with ASX/FE operating rules.
They may of been able to get up to 80% of the futures pool, and better than the woefull 36 or so percent of the OTC CFD cash .


----------



## pifouSyd

1) I have not yet seen the creditors presentation posted on deloitte's website
2) GG - your post is incorrect
3) Check this out: this excellent white paper presents the issues with a broader perspective. ASIC and Bill Shorten's office should read this too. There were commercial organisations at yesterday's creditors' meeting who are clearly affected by the MF Global collapse (GrainCorp, Georges Weston Food (the tip top bread), superannuation funds); it's not just the financial speculators's problem
http://www.futuresmag.com/News/2011/11/PublishingImages/MF Global White Paper- FINAL.pdf
(in case the link above does not work, that's: futuresmag dot com/News/2011/11/Pages/CME-gives-300M-guarrantee-to-SIP-Trustee-for-customersegregated-funds dot aspx)
4) The sad thing is that everyone is starting to pull the cover in their direction; some claim their losses from slippage when their positions got liquidated several days after 1st-Nov should be shared by all (guess they would not be willing to share any profit from slippage); others, essentially non-active traders with a dormant account claim they can't take any loss as they were not in the market (these should have a better read now of what the PDS clearly states - or even better, read the PDS next time before they open a trading account)
So, instead of moving towards a situation where 50%-70% of the funds could be released in the very short term, we now face a situation where the Administrators will have to fight multiple claims. No need to be a rocket scientist to know who will benefit from that situation: lawyers and the administrators, using the segregated account money to finance their fees - God knows for how long.
pf


----------



## Trader101

pifouSyd said:


> 1) I have not yet seen the creditors presentation posted on deloitte's website
> 2) GG - your post is incorrect
> 3) Check this out: this excellent white paper presents the issues with a broader perspective. ASIC and Bill Shorten's office should read this too. There were commercial organisations at yesterday's creditors' meeting who are clearly affected by the MF Global collapse (GrainCorp, Georges Weston Food (the tip top bread), superannuation funds); it's not just the financial speculators's problem
> http://www.futuresmag.com/News/2011/11/PublishingImages/MF Global White Paper- FINAL.pdf
> (in case the link above does not work, that's: futuresmag dot com/News/2011/11/Pages/CME-gives-300M-guarrantee-to-SIP-Trustee-for-customersegregated-funds dot aspx)
> 4) The sad thing is that everyone is starting to pull the cover in their direction; some claim their losses from slippage when their positions got liquidated several days after 1st-Nov should be shared by all (guess they would not be willing to share any profit from slippage); others, essentially non-active traders with a dormant account claim they can't take any loss as they were not in the market (these should have a better read now of what the PDS clearly states - or even better, read the PDS next time before they open a trading account)
> So, instead of moving towards a situation where 50%-70% of the funds could be released in the very short term, we now face a situation where the Administrators will have to fight multiple claims. No need to be a rocket scientist to know who will benefit from that situation: lawyers and the administrators, using the segregated account money to finance their fees - God knows for how long.
> pf




Hi I think there is a key point being missed here. DBA is the second largest bond holder of MF GLOBAL (see attached)
http://au.finance.yahoo.com/news/Brokerage-MF-Global-bankrupt-afp-3323400847.html?x=0
and this is probably why it's not paying or has not yet paid the A$48 million Deutsche owes MF Global Australia.
http://mobile.bloomberg.com/news/20...ators-pursue-deutsche-bank-for-cash?category=
This is despite the fact that DB is paid a risk premium for holding it's lowly rated MF Globlal paper. this is where you need to focus the fight.


----------



## Garpal Gumnut

pifouSyd said:


> GG - your post is incorrect




I hope so, but the UK Guardian tells me that MF Global is all over the place in New York.



> The hunt for the missing money is reportedly being complicated by disorganised paperwork within the firm. Poor record keeping is believed to have been one of the reasons buyers refused to step in and rescue the firm. Banks, clearing houses and the firm's UK subsidiary have all been suggested as locations of the missing money but so far the trustee and regulator have not said whether they have found the funds.
> 
> Giddens said: "While the investigation is proceeding around the clock we are unable to estimate when it will be complete. The trustee's investigation will be deliberate, thorough, and independent."




http://www.guardian.co.uk/business/2011/nov/11/mf-global-missing-600m-sacks-staff

gg


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## Nick29

CME Group offers to put up 300 million: 
http://dealbook.nytimes.com/2011/11/11/cme-group-offers-300-million-for-mf-global-customers/


----------



## hatton01

I am also caught up in the MF Global Saga (CFD pool). 

My thoughts are the money DB is holding onto right now came from our client segregated funds in Australia.

All CFD trades have now been closed so they should return the margin.

In an effort to draw attention to our money which is not being returned by DB what if 500++ of us turned up at the DB branch in Sydney ? 

Thoughts/comments appreciated.


----------



## riskapur

If most / all positions are closed and it is simply a case of counterparties of MFGA withholding money (eg Deutsche Bank Australia (DBA)) - then client balance holders or representatives thereof  have to get on to ASIC and pressure them into enforcing their own regulations onto DBA etc. 

If MF Global has balances with DBA and there are no open positions DBA has a legal obligation to pay back the money to MFGA as soon as practicable. The Client Segregated Account Rule has to be enforced by ASIC - this is Deloittes job as Administrator to get on to ASIC to do this. If in fact, DBA or DB AG had a debenture on the parent company - that is a separate issue - they need to take that up with the administrator of the parent company in the US not hold balances of Australian client money to compensate. It is against US and UK Securities regulations (and also supposedly Australia) to cover shortfalls of company money with client money - so DBA will be breaking laws of all 3 countries by trying to repatriate Australian client money out of Australia to US and UK to do this. In the US and UK, unlike Australia, I believe it is also illegal to cover shortfalls of one client account with surplus funds in another client account (though this should be checked). If ASIC are not enforcing their own Client Seg regulations they are telling all client balance holders in all brokers and banks in Australia that these regulations do not mean anything - and that client balance holders funds rank equally with unsecured creditors. This should be highlighted in the media and ASIC should be made aware of this  - if ASIC cannot take action to enforce their own rules and it does come out in the media there will likely be a run on all brokers accounts in Australia both from local and international parties - not in the in best interests of ASIC or anyone else.  It will make them look like a joke worldwide. This is exactly what CME are trying to prevent by offering a USD 300 million guarantee for client shortfalls. There is no supposed shortfall in Australia yet no one is doing anything to release client funds. It is time we all got on to ASIC to make sure this happens and that counterparties of MFGA  such as DBA are forced to release the funds immediately ....It is easy to force DBA to produce statements showing what positions are still open and what cash balances they have - they have to do this on a daily basis anyway and they would know exactly what funds they have and what positions are open. They have this information now. If DBA are in breach of Client Seg regulations ASIC are within their rights to revoke their license. ASIC has the power to get clients of MFGA their money back - it is about time they used this if the only issue is MFGA counterparties withholding balances. ASIC has to realise that the sanctity of client segregated accounts has to be preserved for the trading and broker industry to survive.


----------



## Nick29

MF Global Canada accounts unfrozen, sent to RBC
RBC Dominion Securities to handle transfer to clients
http://www.reuters.com/article/2011...1V120111114?feedType=RSS&feedName=marketsNews


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## captain black

Nick29 said:


> MF Global Canada accounts unfrozen, sent to RBC
> RBC Dominion Securities to handle transfer to clients
> http://www.reuters.com/article/2011...1V120111114?feedType=RSS&feedName=marketsNews




Spotted this story earlier this morning as well. Good news that the Canadian customers don't have to wear the losses from the US arm.

MF Global Canada went into administration on the 4th November. 10 days later their accounts are transferred. In Australia were told "sometime between 3 - 12 months". Interesting comparing the priorities of various government regulators.


----------



## peterfootwork

Hey Guys, and Girls, 
This has popped up from the ASX  today ,  
	

		
			
		

		
	

View attachment notice2011_231.pdf

	

		
			
		

		
	
 sounds like things are moving on.
But slowly .


----------



## hatton01

Some news about funds tied up at DB:
DB has sort legal advice if they can offset a loss against the UK MF Global office. The good news is it is only a small amount ($2 mil).
My thoughts are as MF Global clients we should be all sending email / hassling our politician's to do something about DB. These guys have no ethics.
Yes! the pace in Aust is very slow!!!


----------



## kavla1970

Even Gerald Celente got caught up in this:

http://www.youtube.com/user/TheAlexJonesChannel?blend=1&ob=5#p/u/5/J5OxXGjJBnM

http://www.youtube.com/user/TheAlexJonesChannel?blend=1&ob=5#p/u/4/5DLtHLSWMX0

http://www.youtube.com/user/TheAlexJonesChannel?blend=1&ob=5#p/u/3/Sf9HIo8NJBg


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## Nick29

http://news.yahoo.com/judge-oks-520-million-payout-mf-global-customers-173458243.html


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## mmis4167

*ASX READY TO RETURN SURPLUS MF GLOBAL FUNDS*

http://www.sfe.com.au/content/notices/2011/notice2011_238.pdf


----------



## robusta

Who wants to be a futures trader?

http://www.zerohedge.com:80/news/en...-collapse-presenting-first-mf-global-casualty


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## westie

Appears they were unable to find a buyer for the Australian entity:

http://www.theaustralian.com.au/bus...an-arm-shut-down/story-fn91wd6x-1226199499827


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## nomore4s

robusta said:


> Who wants to be a futures trader?
> 
> http://www.zerohedge.com:80/news/en...-collapse-presenting-first-mf-global-casualty




While there might be some valid points I don't know if I'd be putting too much weight to her writings, she seems like a bit of a nut job.

http://www.youtube.com/watch?v=aCfbYkXtHuA&feature=related

http://www.youtube.com/watch?v=riSJcZC89Hc&feature=related


----------



## Garpal Gumnut

Garpal Gumnut said:


> Lets face it folks, your money is gone.
> 
> There is buckleys of you ever getting much if any back, as there is criminality at 3 or 4 levels of separation from you.
> 
> It sounds like a Storm Financial Mark2 in a way, litigation is the only option and the lawyers will suck most of it up anyway. The local dealers will fall back on the statements you all signed prior to opening your accounts.
> 
> gg




I must adjust my pessimistic tone.

You will get 50% back I reckon, based on musings picked up from ABC NewsRadio, PBR and Deutsche Welle.

gg


----------



## hatton01

Not sure how you arrived at the maths where you ended up with a 50% limit Garpal ? I am glad it gone up from the very pessimistic tone of "lets face it folks your money is gone".

As a CFD client I am looking at the current numbers ie: how much is in cash (in a Westpac account) & what's due from the counterparties to the Administrator:

                Aust cfds     Us/Euro cfds  Aust Index Comm index

Gross                       $84 mil


Cash                        $30 mil

Due from   $48 mil        $4 mil            $2 mil       $1 mil

Counter     Deutsche     MF UK            ASX        MF
party

Offset       (-$3 mil )
risk

For CFD's customers the only counterparty offset risk is Deutsche with $3 mil. I wrote about this in a earlier post.
ASX are in the process of returning the funds. 

If for argument sake we take a $5 mil haircut (from all counterparties) then we will get back at least 95% of our funds. 

For the remaining funds we could become a contingent creditor of MF Global Australia who have around $12 Mil in cash. Its a good sign that the ASX is in the process of handing back $34 mil out of the $37 mil of client seg funds.

My suggestions to CFD customers is keep highlighting the fact that Deutsche bank in Australia has a portion of our client segregated funds & they now need to return it  ASAP as there are no open positions. I cant see them not doing it.  Net income for the 3rd Qtr for Deutsche bank was 0.8 Billion Eur.

I am sure Deutsche bank in Australia want to remain in the Investment banking business & want to keep there good name.


----------



## westie

I agree Hatton01, I also have funds tied up in a margin fx account and although I feel confident I will get most of the funds back I wouldn't like to put a % on it.  What I do know is that it will be more than 50% with 80% cash already held.

I have found this forum has given me very useful information from some very well informed individuals.  I have gained links to useful sites and others doing good work in trying to help to recover these funds for clients.  It would be beneficial if all users where so well informed before they made comment, but ofcourse we can just ignore them.


----------



## hatton01

Hi Westie I arrived % by saying if we take a $5 million dollar haircut in the CFD pool.

79/84 = So getting back around 94% of our funds.

I arrived at the $5 mil by saying DB keeps the $3 mil offset risk and we have a shortfall from the other counter parties by another $2 mil.

Yes! this is a guess estimate no doubt.

Very true! many people have been working to get our money back asap & I thank them for it.
Lets hope this nightmare has a happy ending some time before Xmas.


----------



## hatton01

To any CFD clients of MF Global. If you want to help the process along.

Pls give the DB press office a call & ask them if DB could issue a statement about the $48 Mil (ie: when will the margin be returned now that all CFD trades have been closed).

A hundred++ calls would be nice! 

If we dont get any traction here the next step will be to get as many CFD clients to call in person at the Sydney office. I would be willing to come down from Brisbane for the day.

DB press office phone no:
Tel: 02 8258 2416


----------



## riskapur

If you want DB to give funds back (and by the way DBA are in breach of Companies ACT client seg rules as they are written, by withholding them for their $3 million offset) then a statement showing what MFGA's cash balance with DBA is, and what the results of the close out of the positions is, should be demanded first. DBA has this information now - they would have had this as soon as the last position was closed out. This is ASIC's responsibilty to enforce that this statement gets released to MFGA or Deloitte now - why are ASIC not doing this??? By law clearers have to give these statements to their clients on a timely basis - this does not mean every 3 weeks!! Once the statements are released ASIC are in a position to force DBA to remit the balances to MFGA WITHOUT Set off - DBA has to rank equally with other customer balances of MFGA not ahead of them for their $3 million since they are also a customer

I just spoke to Deloitte - they advised the only thing holding them up making distributions was the lack of information regarding close outs and cash balances from DBA and ASX. THE ASX requires sign off from Deloitte locally and KPMG overseas (for other MF Global entities). KPMG overseas have not yet authorised the release of ASX funds back to MFGA as yet

I would ask everyone to give ASIC a call and demand the statments and cash balances from DBA - I have already done so twice. Surprise surprise they have not gotten back to me.

Also get it in the press everywhere that ASIC are being far too slow in enforcing their own rules. If ASIC can't enforce these rules, client seg rules in Australia have no meaning - because of this I have already withdrawn all funds at Australian brokers because they could not advise exactly where excess cash is being kept or assure me that it will remain there. You may wish to do the same given client seg rules are not being enforced. 

They have a shortfall of client funds in the US of $600million, CME have guaranteed to cover at least $300 million and despite the net shortfall of $300 million some balance holders are still getting some of their cash back. There is supposedly no such problem in Australia yet there is no cash coming back - why not?? Ask ASIC!!


----------



## hatton01

Hi Riskapur,

This was contained in the latest client update.
I AGREE with you 100%, there have been no issues in Aust yet we have not seen a dime of our money. 

CFD clients

Deutsche Bank (DB) update

DB has indicated that information regarding the close out of MFGA positions will be provided shortly to the Administrators. DB advise all MFGA positions have been closed and they are now going through verification, legal processes and obtaining global sign off before providing the information and funds to the Administrators.


----------



## trade4freedom

*UK = better regulation?*

Hi,

sorry if this may be slightly off topic, but after hearing all of the MF Global drama I'm considering opening my Account through a company in the UK. The Financial Services Authority there has a FSCS = Financial Services Compensation Scheme which basically offers a government guarantee for a certain amount of your deposited funds in case your CFD provider / broker becomes insolvent. As far as I understand this protection extends to non UK residents, too, you just have to have opened the account with the UK branch. This might be good if one considers joining CFD providers such as GFT which offer great value trading accounts (e.g. Silver account = no minimum commission on equity cfd's) but in Australia still use money in client accounts to hedge positions (not allowed in UK and not done by GFT UK).

Alternatively, in AUS, IG Markets seems to be the safest (but not necessarily cheapest)...


Has anyone looked into this or considered this? Any thoughts and opinions would be greatly appreciated.


----------



## hatton01

Hi Riskapur,

So far the only person who has been help is ben butler at theage. I was able to pass on some info about DB holding onto our funds & it resulted in an article intheage on Sat.

I also contacted Mat Tinkler who is the chief of staff for Bill Shorten but the response was a standard one & didnt say much at all. Now where have I seen a response like this before (Yes Minister !!!).

Dear XXXXXX

Thanks for your email in relation to the insolvency of MF Global.

I understand that the insolvency of the US-based MF Global Inc has affected thousands of Australians who have accounts with the Australian subsidiary of the firm. While I appreciate that affected clients will be hoping for a speedy resolution of the situation and the return of as much of their investments as is possible, I note that the insolvency of the US-based parent and the administration of the Australian subsidiaries is a very complex, multi-jurisdictional matter. It is likely to take some time to fully resolve all claims. 

At this stage it is too early to say whether clients and trading participants of ASX 24 will eventually recover their funds in full. The Australian Securities and Investments Commission (ASIC) is working closely with the administrators to seek resolution of outstanding client money, insolvency and market issues as soon as possible. The Government is monitoring events very closely.  I understand that liquidity is returning to affected markets, including grain and wool futures, but operations of a number of participants and overall market volumes are expected to be affected for some time. 

Where a client of MF Global’s Australian subsidiaries has queries, I encourage them to contact Deloitte as the administrators, in the first instance. The email address is mfgaustralia@deloitte.com.au .  Notices and updates to clients and creditors are posted on www.deloitte.com/au/mfglobal (link also via/www.mfglobal.com.au)

ASIC also has an information line and a complaints handling team which investors can contact if they have outstanding concerns, having sought resolution from Deloitte. The contact number at ASIC in relation to this matter is 1300 300 630. 

I trust that this information will be useful for you. 

Regards,

Mat Tinkler

Chief of Staff

Office of Bill Shorten MP


----------



## riskapur

Hi Hatton01

The articles in the media are a big help - so thanks for pushing this. The more media exposure on this the better - it should keep the pressure on ASIC, Deloitte and DBA. And yes agree that the letter from Bill Shorten's office does not really help us much. Buit at least you are in touch with them.

DBA's press release does not tell anyone anything - I don't understand why they cannot release the cash statement and position statement immediately if all positions are closed - they don't need a worldwide sign off for this - they are obligated to release the statement as part of their licensing obligations. Once ASIC and Deloitte see the statement they should be in a position to enfore client seg rules on DBA and demand the cash balances back. Why is it that we need a global sign off from DBA to conform to the Client Seg Rules that they signed up to when they first got their license? Shouldn't this be enforced by our regulator?


----------



## sammy84

Good news-
http://www.theaustralian.com.au/bus...-of-funds-sooner/story-fn91wd6x-1226201857799

Bad news-
http://www.smh.com.au/business/worl...tfall-may-double-to-us12b-20111122-1nrgx.html


----------



## Walkabout

I do feel for you guys who were with MF global.. i have a mate who had a fair amount of money with them also. I sincerly hope you get all your funds returned soon. I am with interactive brokers and am scared they too might colapse not that ive heard anything. what do you guys think?


----------



## westie

Are there any margin FX customers that have been affected by the freeze on client funds at MFGA?

I am having difficulty getting a definitive explanation from the administrators as to what is actually causing the delay in returning client funds within this pool.  

80% cash held with the remainder with the Singapore MF entity.

I have just been told by the administrators that they believe the Singapore entity has closed out all positions and that they are awaiting information on the close out positions for individual clients from KPMG.

Does anyone have anymore information regarding the Margin FX pool specifically?


----------



## skc

Walkabout said:


> I do feel for you guys who were with MF global.. i have a mate who had a fair amount of money with them also. I sincerly hope you get all your funds returned soon. I am with interactive brokers and am scared they too might colapse not that ive heard anything. what do you guys think?




Keep your eye out for warning signs... the share price will not be a perfect signal, but it's better than nothing. This is why I've moved my trading to IG even though they are not the cheapest or with the best platform.


----------



## kavla1970

What has happened is awful and should be followed up by ASIC and God knows who else.


----------



## mmis4167

Walkabout said:


> I am with interactive brokers and am scared they too might colapse not that ive heard anything. what do you guys think?




Hi 

do your own research and do not trust anyone! 

I was a bit worry about MF Global situation shortly before it went into administration. I could have my funds transfered from MF, however I had a chat with my MF advisor and I had changed my mind 

Now you could say they were at least incompetent. 

*Hi xxx

Attached are information on our financial standing. Most importantly the funds you have with us are held in a Client Segregated account where we are not allowed to use to cover our operating costs. It is illegal to use them for anything but clients trading ie margin payments and withdrawal.

MF Global Australia is part of MFG US but the client segregated account in Australia only holds client deposits belonging to Australia and we donot use pay MFG US clients. If you are still worried after going through the articles, you can have excess funds transferred to your account if you're not trading. This is understandable.



Regards

xxx
Client Advisor

xxxx
www.mfglobal.com.au

Follow MF Global Australia on Twitter: twitter.com/MFGlobalAU


From: Markisic, Daren (AUS Int)
Sent: Thursday, 27 October 2011 10:42 AM
Subject: MF Global Information

Attached is some MF Global information on the current situation. Basically, it is business as usual and we hold client funds in a client segregate fund account at Westpac.

Bloomberg is reporting a speculative situation with Goldman Sachs, Citi and/or Evercore Partners, please follow the below link for further information.

http://www.bloomberg.com/news/2011-...ll-profit-if-it-buys-mf-global-bove-says.html

Keep in mind we hold memberships at almost every exchange globally, which in itself it worth a pretty penny.

I will keep you up to date if anything changes, however, at this point we expect no change.

If you have any questions please contact me on my direct line below, or on my mobile after hours.

Regards,
*


----------



## pifouSyd

CME press release:
http://http://cmegroup.mediaroom.com/index.php?s=43&item=3215&pagetemplate=article
Article published in the Chicago Tribune:http://www.chicagotribune.com/business/ct-biz-1123-cme-guarantee--20111123,0,1884395.story

CME is helping the US Trustee SIPC to secure the return of 75% of MF Global customers' cash by early December.
*Australia, what the h... are you doing?*
P-F


----------



## hatton01

Hi Riskapur,
So what do you make of DB taking 20% of the $48 mil  to offset claims & expenses, illiquid positions & market movements.

My thinking is how did they arrive at the numbers (I want to see a breakdown).

Perhaps the first step is get as much publicity of what DB has done to us.
I think a visit to DB by 1000 + clients would have terrific impact.
Is there anyone out there who has organised a mass protest ?


CFD clients

Deutsche Bank (DB) update

On Wednesday 23 November 2011 DB provided the Administrators with information regarding the close out of all MFGA positions. On the same day DB transferred to the Administrators $38m. This is $10m less than recorded in the records of MFGA as at 1 November 2011 and as reported at the first meeting of creditors on 11 November 2011.

The difference includes, amongst other costs: market movements; illiquid positions still held; offset claims and expenses; adjustments. We are in the process of reviewing this information and DB's claims for deductions & offset. We do not have a timeframe for how long this exercise will take.


----------



## Tanaka

hatton01 said:


> CFD clients
> 
> Deutsche Bank (DB) update
> 
> On Wednesday 23 November 2011 DB provided the Administrators with information regarding the close out of all MFGA positions. On the same day DB transferred to the Administrators $38m. This is $10m less than recorded in the records of MFGA as at 1 November 2011 and as reported at the first meeting of creditors on 11 November 2011.
> 
> The difference includes, amongst other costs: market movements; illiquid positions still held; offset claims and expenses; adjustments. We are in the process of reviewing this information and DB's claims for deductions & offset. We do not have a timeframe for how long this exercise will take.




I had no open positions, does that mean if I don't get my full account balance back I have to sue all the people who lost money with open positions. After all, why should I suffer for someone else's trading loss!?


----------



## pifouSyd

Tanaka said:


> I had no open positions, does that mean if I don't get my full account balance back I have to sue all the people who lost money with open positions. After all, why should I suffer for someone else's trading loss!?




Tanaka, what a great (& selfish) idea .... 
1) read your client agreement: ... segregated account means funds are co-mingled among traders ... means each trader is exposed to the actions of other traders ... but should not be exposed to wrong doing from the company (Jon Corzine & Co.) ... good luck with any legal action
2) if you don't trade, why do you keep money in a trading account? There is hardly any interest paid, the money is at risk (see point #1 above) - could only mean you did not care much about safety or return on these funds, otherwise you should have pulled them out and placed them on a cash management account with one of the big 4 banks, ING direct, .... (guaranteed by the government since the GFC)  
3) the consequences of multiple legal actions by people like you are very simple: the "merchants of conflicts" aka the administrators and the legal profession will have a feast - there is plenty of money in the honeypot, watch the bees coming! So instead of losing maybe 5% or 10%, you might end up losing 20% on your money - just watch the speed at which deloitte is burning our money ... add to this your legal costs + the legal cost the Administrators will be delighted to engage to fight off your claim (after all who can blame them for doing anything they can to stay as long as they can and generate as much revenue as possible ... we live in a capitalistic society, don't we? and we can hardly blame them as traders, can we?)
4) I kept the best one for the end - instead of ALL getting our money back in a matter of days (yes we could, just check out what the CCC is doing in the US - commoditycustomerscoalition.org / James Koutoulas), this thing will drag forever. If you've heard about opportunity cost, then the cost us ALL having our money frozen greatly outweigh nay haircut resulting form not bringing 100% of the money home.
If you do trade, then you could make this up in no time.

My recommendation: let's deloitte complete the collection of money that still sits overseas, and then let's just share the pool on a pro-rata basis using our (twice daily reconciled) statements. As the US will do, this is the quickest, most pragmatic, cheapest way of doing this (see recommendation put forward by the CCC and supported by the CME).
Do you prefer receiving 90% or 95% of your money next month, or 100% less 20% to 30% for legal and administration fees in 12 or 24 months? 

If you still want to sue, I suggest you do this after we all receive what we can get.
And rather than suing each other, it would be smarter IMHO to look for avenues to get the money back from the Professional Indemnity insurance (there as been a crime committed) or to sue Jon Corzine and Co.  

pf


----------



## redbin

As a CFD client I will be pleasantly surprised to get 90% to 95% of my money back. After all it appears that DB have helped themselves to 12% of the total CFD pool.

As to timing, I doubt if the Administrators will release funds until they are sure that they don't need to apply to tap into client funds for their own purpose.


----------



## skc

Tanaka said:


> I had no open positions, does that mean if I don't get my full account balance back I have to sue all the people who lost money with open positions. After all, why should I suffer for someone else's trading loss!?




It is not known at this stage what the process of calculating accounting balance would be. I'd imgaine those with open positions who suffered adverse market movements will see their account balance reduced by those movements. There is no reason to believe that the trading losses should be distributed amongst account holders.

To put things in context, DB held ~$48m in MFG funds which supported margined positions. I don't know what margin rates but that $48m could easily support $240m of positions at 5x leverage. 

DB has withheld $10m, of which $2m is reportedly offset against some other parts of MF. I also remember reading somewhere that they are charging a large commission so that can easily account for another $1m. 

They claim to still hold some illiquid positions (which is contrary to the "All CFD positions are closed" claim) and they might actually hold back the full position size (say $2m?) as opposed to just the margin. The rest can easily be market movement (~$6m) - and that's $6m over $240m worth of positions, or just 2.5%.

Pure speculations on my part but until the details emerge on what those $10m held by DB consist of it is not possible to conclude how much account holders can get back.

The good news is that the administrator now controls ~80% in cash so that should be the minimum amount for those with no open positions. I just hope that Deloitte will distribute the majority of these funds under control as a partial payment first, instead of waiting for the last $ to come in... I am sure the creditors will push for that as well.


----------



## hatton01

Hi Ske,
"There is no reason to believe that the trading losses should be distributed amongst account holders" makes a lot of sense to me.
I think the only time the folks with no open positions (like myself) should suffer is if there is a short fall in the total pool amount. I think the strategy I would follow would be to wait for the Admin to distribute what is owing to me first before going down the path of legal action for any short falls. The Admin would love to prolong the gravy train forever so lets not be too impatient.


----------



## riskapur

Hi Hatton01,

No doubt DBA are clipping very large spreads on all close out trades. The problem with CFD's instead of futures, however is that DBA is the counterparty to all of MFGA trades - this means it is very difficult to prove what was a reasonable price to close out the contract unless you were sitting in DBA's office watching them close out trade by trade - supposedly the administrators or ASIC's job or both  - but I doubt either of them they did this. The best you can do is check the range of the security price on the day DBA supposedly closed out the trade  - and if they consistently close out at the worst price for the client you know they are taking advantage of the client as per above - but again very difficult to prove.

So this means that if you executed a long position CFD position with MFGA, DBA could advise you they have sold it at the lowest point over the last 3 weeks, since the time they were instructed to close it out. DBA would have done the hedge internally through their trading book and therefore it would be difficult to prove what the hedge transaction was. That means DBA take the profit between the actual hedge price (well above the low of the last 3 weeks) and the price they tell MFGA it was closed out (by looking at past history of last 3 weeks of worst price for customer) - basically free money for DBA and the customer gets raped. 

At least with futures you can demand to see the other side of the trade - which the exchange would have a record of. Doesn't guarantee you get better close out prices but it does offer a closer monitoring of the close out trade, the prices executed and the time the trade was done. I am sure this is what DBA are doing. Ask yourself this - the futures positions were closed out - balance expected was $36 million - actual cash to be returned $34 million. Difference 5.5%. DBA balance at start $48 million - positions supposedly closed out 1 week ago - DBA still holding $10 million and returning $38 million - difference is 20.83% - why - because CFD customers are being raped by DBA

You can try protesting outside DBA but I really think that ASIC is more to blame by allowing counterparties like DBA rape customers, withhold money (against Client Seg Rules) and not do anything about it. If DBA are charging commission on MFGA close out trades in excess of what is in the MFGA client agreement then this is a breach of Companies Law and needs to be punished by ASIC. This is in addition to their current breach - witholding client money as a set off and trying to get preferntial treatment against other supposedly equal account holders

ASIC has shown what a joke the Australian Securities industry is and how little protection there is for client account holders at brokers relative to other jurisdictions. 

Ask yourself this – how is it that there is a shortfall of $1.2 billion in the US and clients are still getting some money back. There is no / minimal supposed shortfall in Australia and Deloitte has access to well over 50% of futures balances in cash, over 80% or Margin FX in Cash and over 35% of CFD pool in cash. Why can’t they immediately release back to account holders 75% of Margin FX pool, 50% of Futures pool and 30% of CFD pool. 

The argument that Deloitte put forward they need to see all cash balances and positions closed out is absolute rubbish – this presumes that MFGA will have to pay out more balances to counterparties and get zero back in return and this is after all positions have been closed and cash balances known.

My view is that ASIC and Deloitte are too gutless to enforce the regulation like they should. Deloitte undoubtedly have, separate to MFGA, other tax and audit business with DBA they don’t want to jeopardise. I think they only way you have a chance in getting ASIC to act and enforce regulations is if they are highlighted in the media as being totally incompetent relative to regulators in other jurisdictions or if they see the Australian Broking industry on the verge of collapse because all account holders take their balances out of brokers accounts. If ASIC did enforce regulations and revoke DBA’s license this would send a very strong message that the Client Seg rules have to be respected. But this is unlikely to happen so as you can see there is very little protection to client account holders relative to other jurisdictions.

My opinion on court action is that we, collectively as account holders, should get as much of our money back ASAP – if that means taking a 5% - 10% haircut to get it back sooner then we should. We can make the rest back by trading. Our time is worth more than this order of loss.  We are better off having exposure to just ourselves as account holders  (especially with positions being closed out) than taking legal action against ASIC, Deloitte, ASX, DBA etc and see the client balance pool deplete in which case we would have a bigger shortfall in the pool and have to try and reclaim this with other unsecured creditors against the balances in the MFGA company accounts – bad position to be in. If individual account holders want to take legal action they should take this up independently with the relevant parties themselves, after final balances are paid out to all account holders, and not subject other client account holders unfairly to this action.


----------



## Tanaka

I'm only kidding about suing! 

I do all my trading through IB these days. I left a small amout with MF Global just in case  a signal came up on the ASX and then I could use a CFD. I don't hold my money in trading accounts  I had all positions closed b4 all of this went down.

*Note to self read IB's PDS after typing this.


----------



## pifouSyd

Riskapur / Hatton01 - agree with you 100%, we need the money back asap. If deloitte can extract more money from the like of DBA, good on them, but they don't need to hold our money frozen while they do this. If more money comes later, it can always be distributed.
If anything, getting the money out asap is basic risk management - the longer it stays in the hands of the Administrators, the higher the risk.

Hatton01 - that's right. Every person with open positions at the time of the collapse will have to take the cost of slippage. That's the reality of trading. Below is an extract of MFGA PDS: 
[…]
_(d)           Under certain conditions, it could become difficult or impossible for you to 
close out a position. This can, for example, happen when there is a significant 
change in prices over a short period. 
(e)           All exchange traded derivative contracts involve risk and there is no trading strategy that can eliminate it, placing of contingent orders (such as a 'stop-loss' order) may not always limit your losses to the amounts that you may want. Market conditions may make it impossible to execute such orders. 
(f)            Under certain market conditions it may also be difficult or impossible for you to manage the risk of open positions by entering into equivalent and opposite positions in another contract month, on another market, or where relevant, in the underlying instrument.
(g)         Under certain market conditions the prices of exchange traded derivative contracts may not maintain their usual relationship with the 
             underlying market. 
[…]_
Surely, these were extraordinary circumstances, in which one should reasonably accept that closing positions had become difficult or impossible. There is no way traders with negative slippage should have the other account holders share their losses (they wouldn't come forward if they had enjoyed positive slippage, would they?). Unless the slippage is such that it exceeds the cash they have in their accounts and they declared themselves bankrupted, it should not affect the pool, just their balances. 

Tanaka - glad you're just kidding. And yes, probably all of us will think twice about how much money we should leave in the broker's account.


----------



## pifouSyd

Taking into account the recent update from deloitte, 81% of the funds have been recovered in the CFD pool and 67% in the futures pool (before the pending recovery of the $34m from ASX). Please find attached the updated figures for each pool. 

View attachment 1111 24 Futures pool.pdf

	

		
			
		

		
	
  -  
	

		
			
		

		
	

View attachment 1111 24 CFD pool.pdf


Just thought of another reason while the Administrators may not be so keen to distribute our funds quickly: all the time our money is sitting in the segregated account, the accumulated interests flow back to MFGA, where deloitte will initially look for funds to cover its fees. The initial ~$140m that were sitting in Australia as of 1-Nov would return $0.7m in the first month. Add to this the additional collections (nearly $70m last week) and the compounding effect, and you'll see the incentive for the Administrators to take things slowly.

pf


----------



## riskapur

piFouSyd - exactly the interest keeps building up on OUR accounts to pay unsecured creditors - this is almost criminal in itself. Hence the delay in payment.

Check out the link below - MF Global FX customers in Canada will get PAID ALL their balances back within a week - due to to a fund that protects their deposits - this is proper protection of client money up to the maximum threshold for the cutomer protection they have in Canada. And it demonstrates how a regulator should act.

http://forex.blog900.com/2011/11/26...-clients-to-get-the-money-back-by-december-2/

The point is they have proper proection and the pay their customer back - not the joke situation you have in Australia - no protection at all and ASIC is too gutless to enforce the repayment of customer funds and allow parties like DBA to legally steal money from customers (this is the case until ASIC order DBA to fully pay the customer balances back less a reasonable amount of closeout slippage) .

ASIC and Deloitte have NO EXCUSE to withold customer money - they MUST authorise reasonable partial payment immediately - all positions are closed and they have access to more than 50% of all product pools in CASH. 

There is a serious with the system and lack of client protetction  in Australia  - hence I have taken all money out of Australian Brokers and opened up accounts in Canada, and the UK (where there is some protection under FSCS up to £35,000) 

In the US the system is just obviously corrupt - have a look at the link below
http://www.huffingtonpost.com/janet-tavakoli/mf-global-revelations-kee_b_1107097.html

The regulators and trustees obviously know where this "missing" USD 1.2 billion is 
- they just can't tell the public as it would implicate the regulators who are supposed to protect the customer balances. Then the whole US Broking Industry would collapse as customers clamber for the exit to withdraw all their balances. USD 1.2 billion does not just disappear - no one wheels out the cash in wheelbarrows these days - everything is electronically traceable and CME supposedly did an audit of MFGUS on 26 October that reconciled all customer balances.  The trustee and adminstrators  and regulators really expect us to believe that in those 6 days (between 26 October and 31 October) when the USD 1.2 billion was  stolen - they are unable to trace this over the last 3 weeks???

The big lesson in this folks - where possible only open your trading accounts where there is proper protection in place (eg a compensation scheme like in Canada or the UK or Ireland) and you don't have corrupt regulators like in the US or gutless ones like you have in Australia.

In my view, Corzine will unlikely get prosecuted or go to jail - as he will likely implicate the CFTC and the SEC, saying they knew about or were complicit. It is likely his lawyers will argue that at least one of these authorities knew about the stealing of customer money and co-mingling of customer funds well before the bankruptcy notice on 31 October.


----------



## riskapur

2 other points - 

If CME can put up $600 million to partly cover the shortfall in the US to try and give client holders some extra money back - why is it that the ASX can't even put up $3 million to cover their shortfall in Australia???

In the US, I suspect the delay is not in finding the money but devising a plausible story that will minimise expsoure of the cover up between criminal actions of MFGUS directors and corrupt/negligent regulators


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## redbin

How many of you have actually written to the Administrators, attaching an account statement, and asking for a redemption of your funds?

The Administrators' role is to replace the management and they have broad powers. Until you have actually asked for your money, they can justify not giving it back. The more people who demand their money will put more pressure on them to at least provide a partial redemption. This can be done by email followed up by snail mail.

The current situation has the potential to turn ugly very quickly (litigation) and it is important we get some money back as quickly as possible.

I am currently involved in another Administration situation which has been ongoing for 20 months with no resolution in sight.


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## IFocus

redbin said:


> How many of you have actually written to the Administrators, attaching an account statement, and asking for a redemption of your funds?
> 
> The Administrators' role is to replace the management and they have broad powers. Until you have actually asked for your money, they can justify not giving it back. The more people who demand their money will put more pressure on them to at least provide a partial redemption. This can be done by email followed up by snail mail.
> 
> The current situation has the potential to turn ugly very quickly (litigation) and it is important we get some money back as quickly as possible.
> 
> I am currently involved in another Administration situation which has been ongoing for 20 months with no resolution in sight.





Really good post Redbin Thanks


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## IFocus

Tanaka said:


> *Note to self read IB's PDS after typing this.




On another forum never to be mentioned on this one is a good suggestion is to watch IB's share price IBKR and act accordingly.


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## banco

riskapur said:


> piFouSyd -
> In my view, Corzine will unlikely get prosecuted or go to jail - as he will likely implicate the CFTC and the SEC, saying they knew about or were complicit. It is likely his lawyers will argue that at least one of these authorities knew about the stealing of customer money and co-mingling of customer funds well before the bankruptcy notice on 31 October.




It's crazy how incestuous the financial world is in the US.  The head of the CFTC is Corzine's buddy from his Goldman Sachs days.


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## riskapur

So why does it take Deloitte Australia and ASIC 3 months to repay Australian Account Holders at MFGA????

https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20111115/GIMFGLOBALCANADA1115ATL

https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20111116/GIMFCANADAPARKINSONATL

Do we, as account holders, need to collectively independently engage legal counsel to start initiating actions against the administrator and ASIC to get our money back now and get this in the worldwide media?


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## Tanaka

IFocus said:


> On another forum never to be mentioned on this one is a good suggestion is to watch IB's share price IBKR and act accordingly.




Sound advice there!

:thankyou:


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## hatton01

The story I am getting for the CFD pool is not all of the info about open positions are in from the counter parties so the Admin cannot reconcile all of the client positions. So he does not know how much can be returned to clients?

I guess if you think about the $10 million short fall in what Db returned this must be the slippage in CFD Client open positions. If this is not the case then those who did not have any open positions on the day will also have to be allocated part of the short fall.

I still think clients should "PLS WAIT" untill funds are released before any legal action is taken. Once we are all cashed up we can consider the merits of a class action for any shortfalls especially those of us who did not have any open positions on the day.


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## skc

Tanaka said:


> Sound advice there!
> 
> :thankyou:




Same suggestion here...



skc said:


> Keep your eye out for warning signs... the share price will not be a perfect signal, but it's better than nothing. This is why I've moved my trading to IG even though they are not the cheapest or with the best platform.
> 
> View attachment 45264


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## hatton01

If you are not happy with the Administrator still holding onto our funds you may want to follow Brent' s example & forward the following email to Bill Shorten.


Email To Bill Shorten, MP.


From: Brent Penfold [mailto:bpenfold@tpg.com.au] 

Sent: Monday, 28 November 2011 12:48 PM

To: ministerialemails@treasury.gov.au

Cc: Brent Penfold

Subject: Deloitte dragging their feet in the administration of MF Global Australia


To the Honourable Mr Bill Shorten MP, 

Minister for Financial Services and Superannuation; Assistant Treasurer.


Re: Deloitte dragging their feet in the administration of MF Global Australia


Dear Bill,

I’m contacting you to draw your attention to Deloitte’s apparent unwillingness to provide a part distribution of account balances to clients of MF Global Australia (MFGA), similar to what is happening in Canada and the US.


It appears to be Deloitte’s preference to hold on to client property held in client segregated accounts until at least April 2012 (after the second meeting of creditors).


I would like to know why 20,000 Australian account holders have to wait so long while the Canadian and US customers of MF Global will receive the majority of their funds by early December?


It appears to me that it’s obvious that it’s in Chris Campbell and Deloitte’s interest to select the longest possible process in order to maximise their fees.


I have pointed out the excessive level of their fees both in the media and in a personal meeting I had with Chris Campbell on Wednesday 9th November.


In my opinion they haven’t taken a proverbial hammer to crack the administrative nut of MF Global Australia. They’re taken an excavator!


If you weren’t aware I can assure you that MF Global was a moderately sized business with around 100 staff operating in a single office in Sydney, in the same building as Deloitte. Their business was essentially the electronic execution of trading orders and electronic reconciliation of cash transfer balances between 80 odd accounts spread amongst foreign currencies. It was a supersized ATM business. Now I acknowledge I’m probably being a little unfair to MF Global Australia, but what I’m trying to express is the simple truth that brokering is not rock science. But you wouldn’t believe that with their estimated first month of fees being over $1,000,000! 


Now Deloitte’s objective in maximizing their fees goes against the best interest of the Australian clients of MFGA.


Deloitte’s delay in distributing client property is causing a huge opportunity loss for clients.


You see clients are traders and advisers.


Traders and advisers need their trading capital to make a living.


Traders cannot trade while Deloitte holds on to their capital.


You will see many advisory businesses fail due to this situation.


You will see many individuals being unable to meet their current financial commitments.


And this is totally unnecessary as Deloitte acknowledges that over 50% of clients funds are sitting in the segregate accounts.

There is nothing stopping them from making a distribution.


This can easily be achieved as the customer coalition formed in the US have put forward, with the support of CME (the largest derivatives exchange in the world).  As a result, US customers are expected to receive 75% of their funds by early December; Canadian customers are due to receive their funds in a similar time frame.


So why can’t Chris Campbell and Deloitte treat the Australian MF Global segregated client accounts in the same manner as the US administrator?


If it can be done in the US it can be done here!


I believe your intervention or mere questioning of this situation would pressure Chris Campbell and Deloitte to apply the same methodology as the US administrators.


If it can be done in the US why can’t it be done here?


And just as importantly, and if not more so, your intervention and the resulting relief to account holders will underscore a fundamental corner stone of Australia’s financial system, that client segregated accounts are just that, segregated from and not part of a brokers business whether it be in an Administrator’s hands or not, but belong to the client.



Yours Sincerely 

Brent Penfold

MFGA Client

Futures Trader & Adviser

ASIC AFSL No. 225946


----------



## pifouSyd

Why do US clients get their funds back, and not Australian clients?

Good advise Hatton01

In addition to emailing Bill Shorten, here is a list of things you can do to keep the issue "top-of-mind": 
- call the politicians' offices: this will generate discussions about the issue, it makes it personal, and will draw attention when it starts to keep their phones busy: Senator Mathias Cormann, Shadow Assistant Treasurer, Shadow Minister for Financial Services and Superannuation  (his Policy Advisor Peter Katsambanis promised me he will call deloitte tomorrow morning), your local member
- call deloitte and ask them the questions
- lodge a complaint with ASIC: http://www.asic.gov.au/complain
- lodge a dispute with the financial Ombudsman: https://forms.fos.org.au/OnlineDispute

Suggested talking points (similar to Brent's email):
-	I’m a customer of MFGA and all my funds have been frozen since 1-Nov
-	I derive my income from these funds, and like thousands of people like me or advisory firms, I am without income as long as these funds are frozen and consequently under Financial Difficulty
-	The situation in Australia is much simpler than the situation in the US: segregated accounts in Australia were all in surplus, there was no illegal use or theft of customers funds by the company and it had much less accounts, much less funds under management and much less open positions to transfer or liquidate
-	More than 2/3 of funds have been collected as of 24-Nov  for the 2 largest segregated accounts (CFD 81%, futures 67%)
-	Why then can deloitte in the US give the US customers their money back and deloitte Australia can’t make an immediate partial distribution of funds to Australian clients?
-	Can we trust deloitte to act in the clients’ best interests, when their obvious interest is to adopt the slowest possible process to maximise their fees and to leave the money frozen as long as possible to maximise the interests flowing back into the company to fund their fees? 

People power – Act now! – Keep the issue top-of-mind – Let's get a partial distribution before Christmas!

pf


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## kavla1970

pifouSyd said:


> Why do US clients get their funds back, and not Australian clients?
> 
> Good advise Hatton01
> 
> In addition to emailing Bill Shorten, here is a list of things you can do to keep the issue "top-of-mind":
> - call the politicians' offices: this will generate discussions about the issue, it makes it personal, and will draw attention when it starts to keep their phones busy: Senator Mathias Cormann, Shadow Assistant Treasurer, Shadow Minister for Financial Services and Superannuation  (his Policy Advisor Peter Katsambanis promised me he will call deloitte tomorrow morning), your local member
> - call deloitte and ask them the questions
> - lodge a complaint with ASIC: http://www.asic.gov.au/complain
> - lodge a dispute with the financial Ombudsman: https://forms.fos.org.au/OnlineDispute
> 
> Suggested talking points (similar to Brent's email):
> -	I’m a customer of MFGA and all my funds have been frozen since 1-Nov
> -	I derive my income from these funds, and like thousands of people like me or advisory firms, I am without income as long as these funds are frozen and consequently under Financial Difficulty
> -	The situation in Australia is much simpler than the situation in the US: segregated accounts in Australia were all in surplus, there was no illegal use or theft of customers funds by the company and it had much less accounts, much less funds under management and much less open positions to transfer or liquidate
> -	More than 2/3 of funds have been collected as of 24-Nov  for the 2 largest segregated accounts (CFD 81%, futures 67%)
> -	Why then can deloitte in the US give the US customers their money back and deloitte Australia can’t make an immediate partial distribution of funds to Australian clients?
> -	Can we trust deloitte to act in the clients’ best interests, when their obvious interest is to adopt the slowest possible process to maximise their fees and to leave the money frozen as long as possible to maximise the interests flowing back into the company to fund their fees?
> 
> People power – Act now! – Keep the issue top-of-mind – Let's get a partial distribution before Christmas!
> 
> pf




This is awful. Look at what Gerald Celente is going through with MF Global.

Is our Government involved or are they in hiding? This is unbelievable....

http://www.youtube.com/user/TheAlexJonesChannel?blend=1&ob=5#p/u/1/CkjDBRuQyS0

http://www.youtube.com/user/TheAlexJonesChannel?blend=1&ob=5#p/u/0/oIHmVsJ6SDg


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## Trader101

Hi I think the focus now should be getting the rest of the 10 million from DBA. I think DBA action are appalling not providing any statements for 2 weeks and then not providing adequate statements after 4 weeks. 
Also with the $10 million shortfall I think it's very unreasonable (dba charges MFG less then 4 bps per transaction so can't see fees as being very high for liquidating the positions, in term of market movement most stocks can we liquidated very quickly and market movement can be in favor as well). 
Regards if DBA were correct about everything why have they not provide administrator with statements 1 month into the bankruptcy.
Simply put DBA actions have been very uncooperative and unprofessional , for 10 mil which they will most likely need to payback DBA are putting at risk there relationship with all their insto client in Australia. 
I think it important to:
Let all major bank’s (particularly compliance and risk people aware of DBA actions with regards to MF global, to let the media know about this (though protest and news article).
This is the perfect time to do this as all banks are reviewing their trading broker after so many banks were downgraded.
Putting pressure on DBA will be the best way to making them return the fund quickly.
I think also need to ask our representative trustee to get more information on DBA actions over the course of the past month.


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## Trader101

I think the focus now should be trying to get the rest of the 10 million from DBA. 
I think DBA actions are appalling not providing any statements for 2 weeks and then not providing adequate information after 4 weeks. 
With the $10 million shortfall I think it's very unreasonable (dba normally charges MFG less then 4 bps per transaction so can't see fees as being very high for liquidating the positions, in term of market movement most stocks can be liquidated very quickly and therefore slippage should be fairly small). 
Regardless if DBA were confident about there calculation they the administrator with statements quickly  and not delay for 1whole .
Simply put DBA actions have been very uncooperative and unprofessional , for  the sake of 10 mil which they may  need to payback, DBA are putting at risk their relationship with all their insto client in Australia. 
I think it important to make dba pay for their action and put pressure on them to payback the money quickly:
We should let all major bank’s know of the risk of trading with dba(particularly compliance and risk people) by emailing them over  DBA’s actions with regards to MF global, to let the media know about this (though protest and news article). Please only send through factual information. 
This is the perfect time to do this as all banks are reviewing their trading brokers after so many banks were downgraded last 2 weeks.
Putting pressure on DBA clients and via the media will be the best way to making them return the fund quickly.
I think also need to ask our representative trustee to get more information on DBA actions over the course of the past month.


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## hatton01

I think I only know of one way of getting our $10 million back from DB. 

They need to be get some very negative publicity from some very angry MF Global clients about ie: the greedy Bank "Stealing our money". 

It has to be done in person by at least 500+ of us turning up at there office in Sydney demanding a return of our client segregated funds. Not sure how many of you would join a peaceful rally outside there office ? (I am in Brisbane but would we willing to come down for the day).

Not sure how we can get a list of CFD customers ?

Unfortunately this is a bit of an old story so hard to get the press involved.
I even had to give permission to print my name to get one story published.

Maybe the next step might be "letters to the editor" highlighting how risky it is to have funds tied up with Australian brokers?

If the above does not work then a "class action" is the next step.

Should see a email from our Administrator re the Committe of Creditors meeting last Friday.


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## Trader101

Jim Taig has it. should ask him to send the email out as he can't give the distribution list away
trade@seismo.net.au


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## hatton01

I called the following number (from the Admin MF Global website) which is now being redirected to the MF Global office this morning.

Tel: +61 2 8273 8851 (9am-5pm weekdays).

The phone was answered by the only helpful person (from MF Global) I have come across in this whole saga. 

I am told DB have passed on more infor re the open CFD trades. There is going to be another meeting (between MF Global Aust staff & Db)this week to get the remaining data & then more due dilligence (ie: checking for fair prices etc) before client accounts will be updated. We wont get back all of the remaining $10 million but some of it due to slippage. Once all of this is done we should have "distribution of our funds". 

I am feeling a heck of a lot more positive today that finally there is end in sight.


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## pifouSyd

hatton01

Yes, shame on DBA. 

But more importantly, SHAME ON DELOITTE! 

Because the impact of DBA's actions is only 5-10% of our money at stake, while the action of Deloitte affect 70% to 80% of our money.

Customers are getting their money back in the US, the UK, Canada, Hong Kong and Singapore. Australia will be the only country in the planet where clients will have to wait for years to get their money.

Thanks to who? Thanks to Chris Campbell. He is taking excuse of the Law to refuse to take the only common sense solution : share NOW what's in each pool on pro-rata of the account balances.

Why is he doing this? pure and simple greed. He sits on a pile of gold, and will not let go easily. As Administrators, he controls everything and is the only one with access to the information.    

His plan is simple: make the reconciliation as complex as possible - select an approach as divisive as possible to encourage customers to fight against each other.
This is text-book insolvency firms tactics - merchants of dispute.

He's already made very clear that any dispute within a pool will need his actions and Deloitte's lawyers fees funded by that pool. All he needs is to provoke the dispute.

If you don't believe me, here is a little example: 2 days before the first meeting of creditors, I met privately Chris Campbell with a couple of other fellow traders to seek clarification on the approach taken by Deloitte. Chris told us he would not mention the claim by some large account holders not ready to accept the losses resulting from slippage during the liquidation of their positions and over-stating their claims,  because he did not want to give other traders encouragement to do so.
Yet what happened on Friday 11th November at the First Meeting of Creditors?
He not only mentioned that fact several times, but this was his key talking point when he accepted interviews from the media:   
http://news.theage.com.au/breaking-news-business/mf-global-clients-overstate-claims-admin-20111111-1nbft.html

The key action of the CCC in the US (http://commoditycustomercoalition.org/?page_id=185) was to enable a quick distribution of funds back to clients. They got approval in court to take a radically simplified approach and use the information available (account balance statements) rather than the protracted approach initially proposed by the Trustee.

Chris Campbell is claiming that the law in Australia prevent him to distribute the money to clients quickly, as he is concerned that he might unfairly impact on client's property.
Mr Campbell, every minute you delay the distribution of our funds, you are unfairly impacting our property. We can't trade, we cant' make a living, we can't put food on the table and pay the bills.
And what a joke! Australia, with its best financial regulatory framework in the world, not even capable to protect investors money and make a farce of the implementation of segregated accounts in Australia.

Mr Campbell's arguments are just HYPOCRISY. The reality is that Deloitte and Chris Campbell's objective is to keep the administration going for as long as there is money left in the segregated accounts. And in addition to raking up huge fees, they also profit from the interests from our frozen funds.

Our actions should target Deloitte - this is hurting all of us much more than DBA.


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## hatton01

Hi Pifousyd,

1/  I think the fairest solution for each pool would be for clients holding cash not to be penalised by those clients who held open positions on the day & now have to take a loss. Have you ever heard of another client paying for one of your trading losses ? Unfortunately for clients holding open positions this was a black swan event! From all accounts I think this is the direction Chris is heading in & I am happy to wait a few more weeks if it means my cash only CFD account does not have to take a large haircut like 20% loss.

2/ As for the Administrator making a claim on our interest check the FAQ. 

3/ If you look at the MF Global (Aust) company position the net assets are $10M. Ample funds to pay Chris. He is certainly not going to charge us $1 mil a month from now on as there isnt a heck of a lot to do any more? I think he addressed this at the first meeting when my mate Brent accused him of being greedy. There is even a contingent liablity of $2m + another $2m for short falls in the client pools.

I would think by Jan 2012 the CFD accounts should be reconciled. No reason not to distribute CFD funds back to clients.

4/ Not sure about all of the other countries you mentioned but the Canadians got there funds back thanks to a system called the "Canadian Investor Protection Fund" which has been specifically setup for when a member broker goes insolvant. I think the Seg funds get transfered to another member. Something that should happen here if they want us to have faith in Australian brokers moving forward.


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## riskapur

Please do not believe what Deloitte are telling you unless you can verify this independently. As we all agree Deloitte have an interest in dragging this on as they have access to the interest accumulating on our cash balances, as with other unsecured creditors. And don't believe what the remaining staff at MFGA tell you when you ring up 8273 8851 - they are now working for Deloitte and they get told to tell us what Deloitte tell them - that everything is fine and dandy and Deloitte are working hard. More lies...

What Deloitte are saying about DBA not providing enough information is complete rubbish. DBA's systems are automated and have been providing the same information to MFGA for the last x number of years so they could be reconciled at least daily by MFGA!! There was enough clarity in those statements for us to get our statements daily and also be margin called on a daily basis if needed to be. Now suddenly their reporting has changed so Deloitte don't get enough info to reconcile positions in 3 weeks.........I wish Deloitte would not take us for fools and just come out and say that for them to get paid their fees to do this job this needed to be a 3 month engagement. Then we can decide if we want to remove them or not. But Deloitte may have done a deal with ASIC in advance to make sure they get at least 3 months interest on our balances. That would explain why ASIC have done nothing despite many complaints.

Surely we have the right, or those representing our interests on the Credit Committee like Brent, to demand what positions and statements DBA and ASX have provided. Can we not check these independently? 

Deloitte are just in on the game stealing interest from MFGA clients - as has been pointed out numerous times in this blog. If customers in the US can get part of their money back despite $1.2 billion missing (ie 22% haircut) why can't customers in Australia with no client shortfall???? 

There is enough cash in all product pools to make a decent partial payout to all customers  NOW!! All positions are closed - NO EXCUSES DELOITTE PAY UP NOW!!!

I have written a letter of complaint to Bill Shorten and complained to ASIC and the Financial Ombudsman and of course Deloitte - I suggest you all do the same!!! Do not stop unless we get the action we need to get OUR money back NOW!!!


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## hatton01

Hi Riskapur,

I have had another chat with a very reliable MF global person who is still working hard to release our funds. The good news is we should see another update (either today or tomorrow) which outlines a set of timelines for when we should have our funds back.

On the question of interest earned I am fairly certain it will be paid into the client pools.
There is nothing that I have read/researched which indicates interest on funds will be pocketed by the Administrator. I have asked the admin to address this issue as it is an area of concern to many of you.

As a Platinum client of MF global I am in the same boat as everyone else but have also now lost a month's interest on my cash. Like everyone else I will be happy to forget the interest if I am able to 100% of my funds back sooner rather than later.

Anyone know of a good broker in Canada ?


----------



## captain black

Thanks for the update hatton01, much appreciated.



hatton01 said:


> Anyone know of a good broker in Canada ?






As I mentioned earlier in this thread, it's interesting to observe how the different jurisdictions handle a case like this.


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## Trader101

Thanks hatton01
For the update but when I called mf global the answers I got were very different. First the MF Global staff who answered my call did not agree with DELOITTE policy of not paying out the cash they have on hand. 

Secondly the estimate time frame for distribution were not expect till after march. 
Thirdly there a lot of cfd fx (money which is part of the CFD pool that is current held by MF global Singapore. 

In my view we have 2 options 1 wait and hope that DELOITTE pay s eventually, not confident that this will happen or 2 take action as client in the US did. 
I recommend that we take the following action get a list of all the creditor representative that were appointed at the credit meeting: I know Jim Taig is one (pls add to this list)

2nd form a group of clients as a action group. We can collect all the emails on this forum and also ask the IBs such as seismo to send to their distribution list.

3rd decide our demand, we would demand DELOITTE pay out 50% of the client balances. (my personal view is that all current account should be value at the date that MF global went into administration.  We can just work of the GLV as at 3rd of NOV , this will save DELOITTE time in checking the accounts. Say if the cfd balance is 100 mil and DELOITTE collects 80 mil then they need to pay 80% more. If the collect 10 more mil then they distributed that and we make a general claim with the other creditors for the remaining 10. 

I think this is the most fair approach as everyone equally share any loss, no client is responsible for the MF global disaster so we should equally share the loss.  Otherwise the legal cost of arguing over position will be huge and no one will get anything. Open to suggestions on this.

4th we can organize a public campaign (once we get a pool of 500 clients and family members )against DELOITTE and any counterparty that refuses to pay. 
We can have meetings, organize protest send mass letters to MP etc. citing US as an example


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## hatton01

Hi Trader101,

I was just sent this link by Brent.

http://finance.fortune.cnn.com/2011/12/02/james-koutoulas-mfglobal-bankruptcy/

I think it would be a great idea if we can get a distribution list of MF Global Aust clients & a dedicated website to collect signatures.

Even host our own private webinar so we can form a view of what the majority of clients want ?

Would Jim be willing to do the above ?

I agree the first demand must be a partial distribution of funds on hand asap. We definitely dont want to end up in the courts.

Still waiting for the next update.


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## Trader101

Thanks what do you think of using the closing the balance on cob of the 2 nov (time of adminstrtion) rather then pay accounts to go through all the accounts and getting excat fills


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## hatton01

My view is that if you were in cash position then you should not have to wear open position losses. When you look at how the margin's were operating at MF cash positions like mine were funding other traders margins. At IG the house funds provide the margins. Now to ask me to also bear some of those losses does not sound very fair or ethical to me.


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## skc

To me the use of GLV on 2 Nov to determine payout is not the most fair way, but it is the most efficient way.

Take an example of someone who has a small account and abuses the leverage of CFDs... say he was long 1000 BHP at $35 which needed only 5% margin or $1,750. He had $2000 in his account and on 2 Nov his GLV was $2000. Then DB closed out BHP at $34. His position suffered a $1000 loss and his account is worth $1000 - and that's how much he should get back. If this account gets paid out 80% on 2 Nov GLV, he will receive $1600 and be better off at the expense of others. I think that's Deloitte's point and while it is valid it also suits their incentives to take their sweet time.

IMO accepting the DB close out price is just part of trading. Sometimes you get a nasty fill to no fault of your own, but you have to live with it. And in reality, someone will be slightly better off as a result of the fills as well. If that someone was you, you wouldn't be complaining.

The right way to balance the accounts is pretty simple IMO. Say across all clients there were 20,000 long BHP and 10,000 short BHP... I assume DB would simply sell the net 10,000 BHP and achieve a close out price (say $34 VWAP). Then everyone with an open position on BHP gets that same close out price. It would be silly to work out which parcel of DB's trade relates to which particular account's holding.

This is why I don't understand how it takes so long. A couple of analysts with a few spreadsheets will be able to calculate the net exposure across all the accounts for all the securities (actually pretty sure MFGA will have the information at hand everyday). Then you take the information from DB and calculate the average close out price for each security, enter that into the system and you get the account balances. It really shouldn't take more than a week or two, unless these highly paid vocational students working for Deloitte don't know how to use Excel yet.

Having said all that... if DB or Deloitte wants to play games and drag this thing out, I am OK with getting a partial distribution (say at least 75%), and have this process be more efficient while sacrificing some fairness. 

So my proposed action would be:
1. Ask Deloitte for an explanation of the close out process (and why it's taking so long).
2. Agree a deadline to the account balancing process - say another 4 weeks.
3. Distribute available funds to account holders based on result of the final balances.
4. If correct account balances cannot be determined due to whatever excuses DB/Deloitte have, make a partial distribution based on GLV on 2 Nov.
5. Continue the account balancing process and claw back funds from other counterparties.
6. Pay out remaining funds to those accounts with excess (and ask for money back from those accounts that got more than their fair share from the partial distribution).

This way we get to attempt some fairness, without letting this drag out forever.


----------



## hatton01

Well finally the email I was promised has arrived with some timelines.
The timeline for the return of funds is not good March/April 2012.


----------



## Nick29

Can someone explain to me why MFG UK is attempting to claim MFG Aus futures segregated cash. How is that possible?


----------



## pifouSyd

I response to Hatton01, riskapur, skc and others

1) the only 2 objectives hurdles preventing an immediate distribution of funds are:
    - the remaining unknown liquidation prices (should not be too many by now)
    - the agreement on a fair allocation of the liquidation prices, when the range of prices for a given instrument is large ; the simplest and fairest way to do this is to use a weighted average
2) as soon as we can have an agreement on the method to calculate the fair average price of liquidation, the distribution should start straight away. 
Simplest way to distribute the money:
- we settle all accounts that had opened positions with a weighted average price
- we distribute the money collected - less a provision to deal with special situations - using a pro-rata of the account balances. This should not take 3 months.
What has Chris Campbell been waiting for to ask the Court for directions if he can't decide by himself? The issue was there on 11-Nov, what has been done since?
3) until the methodology is approved, make a provision and start the distribution of the money collected so far (less the provision). Surely Deloitte is capable of coming up with some reasonable provision.  
4) hatton01 - while I understand why you would be reluctant to suffer a haircut if you had no positions opened, by nature the segregated account is co-mingling clients funds, and all clients are in the same boat. Harsh perhaps, but it's what's written in the PDS
5) I don't think you could reasonably expect to get 100% of your money back - I would hope you would prefer to get 80% in a few weeks rather than an hypothetic 100% less ... less... less... (after accounting for Deloitte fees and lawyers fees) in a few months
6) Remember, Deloitte's approach will always be the one that maximises their fees - the more divisive, the more complex, the better
7) I can't see how the absence of a compensation fund would prevent Australia to proceed with rapid distribution like in the US - we might not get 100%, but it does not mean we could not get 50%-70% very soon
8) the financial, social, economic and mental impact of delaying the payment of funds should by far outweigh the need for an 100% fair mechanism. I'm sure for many of us speed is more important than absolute fairness (as long as it remains reasonable of course).
I know of a single Mum with 2 kids who is in a desperate situation. We should all keep in mind that there are people that may be ready for desperate acts if they don't get their money very soon, before attempting anything that has the potential to delay proceedings
9) we are currently building a web site ready to collect clients details (email addresses) and donations to fund court action if necessary. A large client is trying to organise a meeting of clients next week - there is an initiative in progress to get clients together to ensure that our interests are properly considered.


----------



## Trader101

I have spoken to the hotline and it appears the cost of the adminstration cost is not decreasing at all. 

I think there is 2 path that we need to progress along, firstly we need to get through to the commitee of creditors. these people of some influence over the adminstrators as they approve the adminstrator's pay. We need to demand that the adminstrator makes a 50% repayment on all accounts based on the GLV value as at liquidation. 

Secondly I think we need to have a more public campaign so that we can lobby all the members of parliment to increase the pace of the payouts and pressure other custodians. I think we can get some parliemnt time via the Green and independant. I mean there must be 20k accounts so petenailly 60k people affect by this issue.

we need someone to get some story about people that are really doing it tough as much detail as possible and get it into the media. Finanly please post an email of someone that is willing to collect all the clients whom are demanding a immediate partial distribution.


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## banco

I would suggest you contact Senator John Williams.  He's the one who got the recent senate inquiry into the corporate insolvency industry started.  He loathes the bastards.  

The other one to contact (particuarly if you are a constituent) is David Bradbury MP.  He's the one with responsibility for corporate insolvency in the Government.

I should add a note of skepticism: ASIC is a notoriously lazy regulator in this area and I can't see them putting any pressure on Chris Campbell unless something he is doing is obviously wrong.  The Courts also tend to defer to the judgement of the administrator.


----------



## Garpal Gumnut

This is beginning to turn in to a Storm Financial thread.

I reckon you will be fortunate to get 50% of your funds backs, lawyers, accountants, brokers etc. will take the rest.

Keep up the fight.

gg


----------



## hatton01

Hi Pifousyd,

I think at end of the day to expedite the process we are in right now we need "maximum impact".

To give you a example of what I mean whenever I ask someone at work, a social occasion or church if they have heard of MF Global very few say "Yes". It was a news item for a few days & things have now moved on.

Politician's, ASIC, Radio stations are just as useless. Our emails are probably sitting in someone's deleted items folder. No one ever replied to me. 

This forum has been invaluable for all us to toss idea's on the best way to get our funds back. But that's about it.

However we now need to get out there & show as ourselves as a "community of traders" who have lost there funds & now being messed around by the big end of town & not getting any where fast.

We should now target one of the Counterparties who still have our funds (ASX,DB), ASIC, or the Administrator that is keeping our money & not doing enough to return it ASAP. Timing is crucial perhaps on a day there is going to be news about John Corzine ? Newspaper ad (will be happy to place one in Brisbane), Twitter, Social media to inform clients. A couple of messages about what is it we want like "we want our money back now" & return of our funds from the counterparties.

At the protest we can collect the hundreds of email addresses for further action.

As for a website one on the lines of the following would be great, a single one would be better with the Aussie equivalent of James Koutoulas.

http://commoditycustomercoalition.org/

I know Brent is close to getting one up. Maybe you could have a consolidated one (Jim Taig + Brent + the futures traders association -the article in Herald or Age may help to track them down).

This is not a "Storm financial" we know where our funds are!

Only my thoughts. And thanks for doing something about our worst nightmare.
Happy to help in any way.


----------



## pifouSyd

Hatton01 and Trader101 and all
We are now a core group of clients with similar views, and mostly aligned to what I've read on this forum. A website is soon to be launched. Hoping to be able to set up a clients support group, to assist in priority the clients in desperate situation. Protest in front of MF Global office, which happens to be also Deloitte's office is also on the cards.
I can share more if you email me at private.futures.trader@gmail.com


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## Trader101

That sounds good - does any one have a contact detail for jamie clinnick - he was ex mf global employee now on the creditors commitee -very smart guy

If we can get Jamie and jim taig in our group then we have 2 member of the creditor committee, and some say over approving pay for administrator


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## redbin

Interesting reading.
http://newsandinsight.thomsonreuter...d_the_great_Wall_St_re-hypothecation_scandal/


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## mmis4168

http://www.bloomberg.com/news/2011-...illion-customer-transfer-amid-objections.html

have a look at British Unit paragraph. Does it mean we have no chance to get any money from US units and if it is a case, from no other units in the world as everyone is going to protect its own clients?


----------



## pifouSyd

The first story is scary (anyone with an Interactive Broker Account should read it).

The second story is bad news but hardly surprising - politicians may claim that Australia 
and the US are best friends, but obviously friendship quickly find its limits ...
Hope this does not affect the $34m owed to Australian Futures clients and held by the ASX. This will be an interesting test for our regulator (ASIC), politicians and our Justice system to prove that they are here to defend Australians.


----------



## mmis4168

pifouSyd said:


> I response to Hatton01, riskapur, skc and others
> 
> 1) the only 2 objectives hurdles preventing an immediate distribution of funds are:
> - the remaining unknown liquidation prices (should not be too many by now)
> - the agreement on a fair allocation of the liquidation prices, when the range of prices for a given instrument is large ; the simplest and fairest way to do this is to use a weighted average




I would rather say it was the administrator who decided not to distribute early. 



pifouSyd said:


> 2) as soon as we can have an agreement on the method to calculate the fair average price of liquidation, the distribution should start straight away.
> Simplest way to distribute the money:
> - we settle all accounts that had opened positions with a weighted average price
> - we distribute the money collected - less a provision to deal with special situations - using a pro-rata of the account balances. This should not take 3 months.
> What has Chris Campbell been waiting for to ask the Court for directions if he can't decide by himself? The issue was there on 11-Nov, what has been done since?




The problem is we need the agreement. I would prefer the most fair solution - not the simplest one. 



pifouSyd said:


> 3) until the methodology is approved, make a provision and start the distribution of the money collected so far (less the provision). Surely Deloitte is capable of coming up with some reasonable provision.




hard to imagine honestly. The methodology is the key. how to treat the account worth  20000 AUD with one open DAX contract with margin of 13000 AUD and gain, lets say 1000 AUD, when margin is somewhere in UK or US? are you going to share the margin cost amongst the traders (PDS)? or debit the holder (the risk she/he took opening the position)? and 1000 gain? return 50% of the funds? and later when we agree to charge the holder  a margin cost, we would ask him/her for return of few thousand? come on...  

As we have, would have or at least we can "create" closing prices, debiting the acc holders for gains/losses on positions and their margins suppose to be on the cards. 




pifouSyd said:


> 4) hatton01 - while I understand why you would be reluctant to suffer a haircut if you had no positions opened, by nature the segregated account is co-mingling clients funds, and all clients are in the same boat. Harsh perhaps, but it's what's written in the PDS



The nature of segregated account, the law and regulator said that my money was safe. And yours too. I have spoken with MF Global about it, ASIC was on guard, politicians. The system was safe.  And even if something unimaginable happens, I would get it back. I have not read PDS. but I am pretty sure you have not too 6 weeks ago. and 6 weeks ago you would not agree to take losses of your fellow traders, just because "'s written in the PDS". 




pifouSyd said:


> 5) I don't think you could reasonably expect to get 100% of your money back - I would hope you would prefer to get 80% in a few weeks rather than an hypothetic 100% less ... less... less... (after accounting for Deloitte fees and lawyers fees) in a few months




so are you suggesting of fast agreement on your conditions (a weighted average) or we have to struggle? 






pifouSyd said:


> 6) Remember, Deloitte's approach will always be the one that maximises their fees - the more divisive, the more complex, the better




it is clear for everyone here




pifouSyd said:


> 7) I can't see how the absence of a compensation fund would prevent Australia to proceed with rapid distribution like in the US - we might not get 100%, but it does not mean we could not get 50%-70% very soon




You are kidding. I do not know the numbers, but if you pay some acc holders too much now, later it will be impossible to take it back and pay the others. look at example with dax contract.  




pifouSyd said:


> 8) the financial, social, economic and mental impact of delaying the payment of funds should by far outweigh the need for an 100% fair mechanism. I'm sure for many of us speed is more important than absolute fairness (as long as it remains reasonable of course).




for many 100% fair mechanism is a priority. I am not sure if it exists, but I would prefer to spend 1 or 2 extra months to find it. 




pifouSyd said:


> I know of a single Mum with 2 kids who is in a desperate situation. We should all keep in mind that there are people that may be ready for desperate acts if they don't get their money very soon, before attempting anything that has the potential to delay proceedings




I am overseas, with no job and couple of 000's AUD in my bank account. Have no means to return Australia. Had to take a loan from my family overseas to survive. I was full time trader - pretty bad one as I have lost almost everything in a such stupid way. 




pifouSyd said:


> 9) we are currently building a web site ready to collect clients details (email addresses) and donations to fund court action if necessary. A large client is trying to organise a meeting of clients next week - there is an initiative in progress to get clients together to ensure that our interests are properly considered.




unfortunately I can not help you guys in Australia, but thanks for your effort and hard work.


----------



## skc

mmis4168 said:


> for many 100% fair mechanism is a priority. I am not sure if it exists, but I would prefer to spend 1 or 2 extra months to find it.




This is the crux of it, isn't it?

As much as I like it to be fair (my account was practically all cash), I would take a 20% haircut now if it means I can get my money back 6 months earlier than the 100% fair method.

I will live with 1 or 2 extra month, but a line needs to be drawn somewhere.


----------



## hatton01

Hi Skc,
In terms of the CFD pool we now have 80% of our funds back (ie: missing 17Mil from the 84 mil)

Whats outstanding is 7 mil from various MF Global O/S branches & the $10 mil Db has held back due to (slippage (7Mil)  + Counter party setoff ($3 mil) against losses in other MF Global O/S branches. 

There is a meeting between the MF Global & DB back offices to help reconcile the data & I would assume the Admin would then know the account balance for every customer within 2 weeks (extra time given as some of the Deloitte's staff cant use Excel!).

Let say for argument sake out of the remaining 7 Mil we dont get back another 2 Mil due to slippage.

So for cash only CFD clients the loss is $3mil or 3%.
For open positions (worst case where they had open position across all counter parties) the loss would be 7 + 3 + 2 or 14%.

I think to implement such a method the Admin would have to go to court to ensure a Judge approves the Admins distribution method.

3% - 10% or 14% is much better than taking a 20% haircut.


----------



## edman79

Every week we wait the chances of getting our money back diminishes.
I wish it was a case of getting 80% back now rather than 90% later.
I fear its more a case of getting what we can when we can before its all gone.


----------



## redbin

While Administrators don't mind being involved in legal action involving the Administration, one thing they will try to avoid at all costs is leaving themselves open to litigation. That's why there won't be any return of funds until it's been clarified by the Courts. Whatever is the best case made at that court hearing is how the funds will end up being distributed IMO. Those who can afford to have their view represented will have the best chance of getting what they want.


----------



## pifouSyd

skc - mmis4168

skc - you are 100% right. The only issue, once all liquidation prices are known, is to agree on the reconciliation method.

Which means we all have 2 options:

1) we all agree to disagree; most will do this convinced that they have valid arguments.

2) we can all somehow (... a miracle must happen here ... ) agree on a common method - a consensus amongst all traders - those who had open positions and those who had not - those who suffered slippage as a result of the liquidation and those who did not.

What is the best outcome? There is no doubt in my mind that the second option offers a better outcome for everybody
a) because it will allow to distribute the money faster
b) because it will allow to distribute more money

Now if I stopped here, I should hear 100% of people say - yeah, agree 100%, more money and faster, I'm in.

OK, so lets go one step backwards and look at
1) why would option 2 get us all our money faster and get us all more money?
2) how can we get to a common consensus?

*Why would option 2 get us all our money faster and get us all more money?*
The answer is simple. Regardless of whether the cause is "right" or not, the minute the matter hits the court, we can all kiss our money good bye. Not because I have no trust in the courts, simply because disputes are costly (legal fees), and lengthy (this also means costly, because the Administrators will need to stay on longer). In addition, the matter is complex, with probably not many precedents - this will only add in cost and duration. 
To make the matter worse, the more fees Deloitte will need to stay on the job, the less cash there will be left in MFGA for employees and creditors, and they will start suing too. And once there is no more cash left in MFGA, Deloitte will seek to get their fees paid from the segregated accounts - and rightly so.
Another point to consider is that whether it's fair or not, the regulation around the segregated account  clearly states that customers funds are co-mingled, exposing all clients to the failure of one. This is clearly not fair, but this is the way it is.

Conclusion: it will take only one client who for whatever reasons decides go to Court (be it as a matter of principle and justice or his perceived own self interest) rather than accepting a pragmatic common resolution to put all the clients of the pool he belongs to in the mess. The irony is that the outcome of this process will be even more unfair, will result in huge delays in getting any of us our money back, and will result in much money available for distribution than if that individual had accepted the common solution proposed.

I've learned over the years that trading is not about being "right". Trading is about understanding risk and reward. 
Going to court and fighting among each other might be about being "right", but it will bring no rewards and big losses (not even risk, because it's guaranteed losses). 

*2) How can we get a common consensus*
Well, this certainly is not easy, although the prospects of failing to reach such a consensus should be a formidable motivation to at least try; if we succeed, this would be an achievement that we could all feel extremely proud of. We spend our time trying to outsmart each other, for once we have an opportunity to all work together for the good of all of us.
What is needed:
- we need to rely on fair, reasonable and recognised experts on each pool to work out a solution
- we then all need to give them the chance to explain to us why they think it is fair and reasonable
- we all have to be ready to accept compromises
- we all need to focus on the big picture (as someone once taught me, successful business people think simply: how much money comes in and when, how much money do I need to spend and when - this is the big picture). We should let go of our beliefs of absolute justice and see what is best from a pragmatic point of view. 

If we can agree and can prevent a request to go to Court to get directions on how to reconcile accounts, the deadline to start the distribution of money will be shorter than the March/April best case scenario.

Now for this, a miracle needs to happen. We need to agree to not disagree. We need to agree that it's not about being "right", it's about when we can have our money and how much. 

For most of us, every month our funds are frozen represents a 5% opportunity loss, money we would have otherwise made from our trading - some more, some less. And it's compounding. 
So I stand here on record saying, I'm happy to give away 20% of my money - compared to what I think I should receive (which is not relevant) - if I can get my money back in 2 months. This is probably double what I normally make, but it is a hell lot less than what it would cost all of us if only one foolish client decide not to agree.

Anyone with me on this?


----------



## skc

pifouSyd said:


> So I stand here on record saying, I'm happy to give away 20% of my money - compared to what I think I should receive (which is not relevant) - if I can get my money back in 2 months. This is probably double what I normally make, but it is a hell lot less than what it would cost all of us if only one foolish client decide not to agree.
> 
> Anyone with me on this?




Agree and will take the same stance.



pifouSyd said:


> I've learned over the years that trading is not about being "right". Trading is about understanding risk and reward.




Well put. My thoughts exactly.



pifouSyd said:


> skc - you are 100% right. The only issue, once all liquidation prices are known, is to agree on the reconciliation method.




I am not familiar with all the product pools, but with ASX equity CFDs, my thought on using the average liquidation price and apply that one price to all positions held for that security seems to be a simple and fair to me. I have not come across other proposed method of reconciliation. Do you know what they are?

I also haven't heard anyone's reasoning with regards to not accepting slippage... I think the CFD PDS would dictate that there is little ground to stand there.


----------



## mmis4168

pifouSyd said:


> Conclusion: it will take only one client who for whatever reasons decides go to Court (be it as a matter of principle and justice or his perceived own self interest) rather than accepting a pragmatic common resolution to put all the clients of the pool he belongs to in the mess. The irony is that the outcome of this process will be even more unfair, will result in huge delays in getting any of us our money back, and will result in much money available for distribution than if that individual had accepted the common solution proposed.




Does it need to be a client to stop distribution? We are creditors according to the administrator. We have the same status as former employees or system providers.


----------



## pifouSyd

skc said:


> I am not familiar with all the product pools, but with ASX equity CFDs, my thought on using the average liquidation price and apply that one price to all positions held for that security seems to be a simple and fair to me. I have not come across other proposed method of reconciliation. Do you know what they are?
> 
> I also haven't heard anyone's reasoning with regards to not accepting slippage... I think the CFD PDS would dictate that there is little ground to stand there.




skc,
I believe the issue is this: once you apply a weighted average price, you will have to make adjustments to all accounts - for some, it will result in a profitable adjustment, for some it will be a negative adjustment; the problem arise from those who would not accept to give money back.

The allocation of fills to accounts is typically a manual process that MF Global performed every day. I've asked several time what method was used, and never got a definitive answer; I've been told it's "first in - first served", at other times I've been told that larger orders were filled first. Not sure it never was a matter of "who yells the loudest gets the best fills" or a "mates" thing. 

My suggestion would be this: in the unpredictable events that unfolded after 1-Nov, I would suggest that no one can demonstrate they had a reasonable merit to justify receiving a better fill than others. It was a mess, every body wanted to get out, and the normal order execution process was broken. Therefore, applying a weighted average price for each instrument is the only fair method.

The next question is : how do you convince those who benefited from a "lucky" fill to give some money back?

i) we could rely on their common sense - it would be better for them and for everybody else to agree among us rather than letting the Court decide for us. And objectively, they should know that going to Court will delay things - and any one who thinks it can be done in a couple of months without significant cost would be well advised to check by themselves (Sonray's clients have not yet seen their money - Lehman's clients have not yet seen their money  - do we want to add MF Global to this list?)

ii) we could push the weighted average method and put the burden on them to go to Court; they would have to prepare their case, fund it, get legal advice and hopefully along the way they will realise that they'd be better off accepting rather than argue - as you said skc the Client agreement the PDS states without ambiguity that there is no guarantee in terms of fills

iii) we could process the account reconciliation using the weighted average method, acknowledge that some will disagree with the method and isolate those who disagree by paying anyone who agrees with the method and leaving those who disagree to fight with what's left - I'm not sure our legal system would allow such a practice (unfortunately), and most likely those who disagree would go to Court to oppose the distribution

iv) we could come to some kind of commercial decision - use the good old 80-20 rule and find a compromise. Lucky people get to keep 20% of the positive slippage they experienced (compared to a weighted average); unlucky people get to keep 20% of the negative slippage they experienced. No one is perfectly happy, but we get an agreement in the end. If we are all adults, we should be able to find an acceptable middle ground that would be much better than bringing the matter to Court for god knows how long and at what price.

An alternative to using the weighted average method is to proceed with the distribution with the fills the way they happened, not wasting any time to figure out whether it's fair nor to calculate weighted average and apply the adjustments. Of course I can hear the "lucky" say: "Yes, this is very pragmatic, let's do this" and the "unlucky" say: "This is absolutely unfair, I will never agree to this". 
Those who suffered negative slippage could to tap into MF Global Professional Indemnity Insurance, if they believe and can prove that MF Global (and/or The Administrators) failed to meet their obligation. Whether it's fair to leave the burden on them is a debatable. It would be better of course for everyone if those claims were submitted after the distribution of funds.

I think it finally comes down to finding a compromise between what's fair and what's practically best for everyone. But everyone should understand that the quest for fairness is unfortunately a long and costly road.

For the record, I suffered some negative slippage and am OK with it. I have already accepted that this is part of trading. I would rather see a quick resolution than trying to get some money back. I'm a profitable trader, not because I argue about the fills, but because I focus my energy on the next trade.

Intellectually and morally, I support the weighted average method because it is fair (and the fact I did experience negative slippage has nothing to do with it).
Practically my preference would be to just distribute the money with whatever balance is on everyone's statement. If we can avoid a court case by adopting a weighted average method, so be it, let's do the extra work.

If we can't avoid a Court case, then let's be very clear - we are all doomed. Like Sonray's clients, and like Lehman's brother - except for one thing: it will be our own doing, because we (clients) could have avoided it.


----------



## pifouSyd

mmis4168 said:


> The problem is we need the agreement. I would prefer the most fair solution - not the simplest one.



If the simplest solution meant getting the money in 2 months instead of 12 months and prevent an additional 40% haircut due to legal fees and additional Administrators' fees, would you still prefer the most fair solution?



mmis4168 said:


> hard to imagine honestly. The methodology is the key. how to treat the account worth  20000 AUD with one open DAX contract with margin of 13000 AUD and gain, lets say 1000 AUD, when margin is somewhere in UK or US? are you going to share the margin cost amongst the traders (PDS)? or debit the holder (the risk she/he took opening the position)? and 1000 gain? return 50% of the funds? and later when we agree to charge the holder  a margin cost, we would ask him/her for return of few thousand? come on...



2 comments: First, you are right, we need a methodology to reconcile the accounts. What I meant is that if there is a disagreement between various methodologies, we could pay everyone what the worse case scenario would give them. What's left in the pool is then subject to debate. Or we just distribute 50% of what's been recovered so far (i.e. 50% of 80% for CFDs and 50% of 67% for Futures).
Second, yes mmis4168, it seems pretty unfair that people like you who were sitting in cash would be affected by the shortfall in recovery from the margin money sitting overseas. And the setup of the segregated account is unfair, in that it exposes all clients to the wrong-doing or maverick behaviour of just one. 



mmis4168 said:


> The nature of segregated account, the law and regulator said that my money was safe. And yours too. I have spoken with MF Global about it, ASIC was on guard, politicians. The system was safe.  And even if something unimaginable happens, I would get it back. I have not read PDS. but I am pretty sure you have not too 6 weeks ago. and 6 weeks ago you would not agree to take losses of your fellow traders, just because "'s written in the PDS".



If only you were right ... just ask Sonray's customers, and Lehman's brother ...
PS: I did read the PDS, that was 8 years ago. I felt it was pretty unfair. I trusted that the application of margin would limit what an irresponsible trader could do. Trading is about understanding risks and accepting them. In fact embracing them.



mmis4168 said:


> so are you suggesting of fast agreement on your conditions (a weighted average) or we have to struggle?



No, this is not what I'm suggesting. 
I believe a weighted average is the fairest method. 
But I would personally prefer to simply distribute the money based on current account balances, because it would be quicker and simpler (and cheaper). It's all about getting the money as quickly as possible - because the quicker we get it, the more money we'll receive. 
For the record, I did suffer negative slippage - it wasn't the first time, won't be the last time. Slippage is part of trading. I accept that.
Some may not - if the only way to avoid court action and internal fighting is to adopt a weighted average method, then I'll support it. Not because I think it's the fairest method. Because I would get my money sooner. And definitely not because I might get some of my slippage back.



mmis4168 said:


> You are kidding. I do not know the numbers, but if you pay some acc holders too much now, later it will be impossible to take it back and pay the others. look at example with dax contract.



Even without a guarantee or compensation Fund, we could still distribute 50% of the money - this would leave enough in the segregated account to not have to take anything back. 
And one thing is sure. Any money from partial distribution would end up in traders' pockets and no one else pockets. For money still in the segregated accounts, this is less certain.  



mmis4168 said:


> for many 100% fair mechanism is a priority. I am not sure if it exists, but I would prefer to spend 1 or 2 extra months to find it.



You're an idealist mmis4168 - and good on you. Unfortunately life has taught me many times that the quest for fairness can be a long, frustrating and very costly road.
It won't be 1 or 2 extra months. It will be years and millions in fees. And not even a guarantee that in the end the result will be fair; which by the way no one will really care about, because by then there won't be any money left. 

The only way to reach an acceptable outcome it to decide this among us. And to all be reasonable and ready to compromise. Let's forget about 100% fairness, not even all fairy tales are fair. Let's be pragmatic. If we want to continue to be traders, we need our money back, as quickly as possible.


----------



## hatton01

Hi pifouSyd,
I am for a quick partial distribution of the 80% that has been returned to the CFD pool. In 2 weeks the Admin should have an account balance for all CFD accounts. What are they waiting for ?


----------



## pifouSyd

hatton01 said:


> Hi pifouSyd,
> I am for a quick partial distribution of the 80% that has been returned to the CFD pool. In 2 weeks the Admin should have an account balance for all CFD accounts. What are they waiting for ?



Hi Hatton01 and all,
My understanding is that Deloitte will be in a position to finalise the accounts reconciliation as soon as they get all the liquidation prices (we should be pretty close from that now) and there is a consensus on the method to use for allocating the fills.

Once accounts are reconciled, Deloitte won't make a distribution as long as:
- clients have submitted claims that exceed their account balance
- clients are disputing the method used to reconcile accounts; the major issue comes from instruments for which exit prices (liquidation, orders fill and transfers) were in a large range between the 1-Nov and the 10-Nov.
- clients have suffered slippage compared to an exit price as of 1-Nov
and any of those above is planning to sue Deloitte, seek compensation and oppose the distribution of funds. 
As long as this risk exists, Deloitte will need to go to Court to seek direction.

The only way to get a quick distribution of funds would be:
- to agree on the method (I think this was one of the task Deloitte was planning to undertake with the Committee of Creditors)
- to get all clients to agree on their statement balances
- and to get clients to commit not to oppose the distribution on the basis of the updated statement balance.
All the above might allow to avoid going to Court (hopefully).

Reasons for Deloitte not to proceed with a partial distribution:
- a partial distribution does not reduce the risk of people opposing that distribution for the same reasons mentioned above,
- while Deloitte could seek approval from the Court for a (conservative) partial distribution of funds before an agreement on the method is reached, they might be of the view that a better outcome is still to find an agreement on the method and then distribute what is available, and use the same distribution mechanism for any additional money collected in the future - which would make sense.
- or other reason

disclaimer: I am a simple futures trader and all the views that I have expressed are my own and imperfect thoughts due to my limited understanding of the situation. People sitting at the Committee of Creditors would certainly know more, but are not allowed to share information (other than information approved by Deloitte). I do not sit at the CoC. The only agenda I have is to help everyone (including myself) receiving their money back as soon as possible. 

I think that compromise and common sense will be more useful to achieve this outcome than emotions and  desire to achieve 100% fairness. 

Going to Court will most definitely not help either. It will only significantly increase the time it will take to get our money back, and significantly decrease the amount of money we will receive. We should only consider going to Court as the last resort, and probably to achieve objectives different than receiving our money quickly.


----------



## pifouSyd

mmis4168 said:


> Does it need to be a client to stop distribution? We are creditors according to the administrator. We have the same status as former employees or system providers.



1) you are correct, anyone can stop the distribution, including creditors (for example, JP Morgan in the US is attempting to block the distribution of funds to US clients)

2) clients is a different status than creditor - as clients, our rights are different than creditors' rights; and the money in the segregated accounts cannot simply be pooled with the money in the company, because it sits in a trust. 

3) while we are clients, we are also all "contingent" creditors, i.e. potential creditors; our creditor status will be confirmed once it is confirmed that some money sitting with counter-parties will not be returned, which is very likely.

So we will end up being both clients and creditors: clients for the amount of money available in the segregated accounts, and creditors for the shortfall.

All creditors will be paid out money available with the company, once all assets have been sold, and priority creditors have taken their due (this includes for example paying employees entitlements).

I imagine that our rights as creditors (low priority) combined with the money available with the company (little) would result in a very low "cent to the dollars" payment (and most likely none).

The haircut we will suffer as clients on the money available in the segregated account should be small in comparison (20%-40%), assuming no one goes to Court to oppose the distribution of our funds, which could trigger a very long and protracted legal process that unfortunately would result in depleting these funds in addition to postponing their distribution.


----------



## garth

Interesting interview with an (ex)commodities broker in the cattle sector.

http://www.financialsense.com/contributors/2011/12/02/ann-barnhardt/interview-transcript


----------



## Garpal Gumnut

mmis4168 said:


> I would rather say it was the administrator who decided not to distribute early.
> 
> 
> 
> The problem is we need the agreement. I would prefer the most fair solution - not the simplest one.
> 
> 
> 
> hard to imagine honestly. The methodology is the key. how to treat the account worth  20000 AUD with one open DAX contract with margin of 13000 AUD and gain, lets say 1000 AUD, when margin is somewhere in UK or US? are you going to share the margin cost amongst the traders (PDS)? or debit the holder (the risk she/he took opening the position)? and 1000 gain? return 50% of the funds? and later when we agree to charge the holder  a margin cost, we would ask him/her for return of few thousand? come on...
> 
> As we have, would have or at least we can "create" closing prices, debiting the acc holders for gains/losses on positions and their margins suppose to be on the cards.
> 
> 
> 
> The nature of segregated account, the law and regulator said that my money was safe. And yours too. I have spoken with MF Global about it, ASIC was on guard, politicians. The system was safe.  And even if something unimaginable happens, I would get it back. I have not read PDS. but I am pretty sure you have not too 6 weeks ago. and 6 weeks ago you would not agree to take losses of your fellow traders, just because "'s written in the PDS".
> 
> 
> 
> 
> so are you suggesting of fast agreement on your conditions (a weighted average) or we have to struggle?
> 
> 
> 
> 
> 
> 
> it is clear for everyone here
> 
> 
> 
> 
> You are kidding. I do not know the numbers, but if you pay some acc holders too much now, later it will be impossible to take it back and pay the others. look at example with dax contract.
> 
> 
> 
> 
> for many 100% fair mechanism is a priority. I am not sure if it exists, but I would prefer to spend 1 or 2 extra months to find it.
> 
> 
> 
> 
> I am overseas, with no job and couple of 000's AUD in my bank account. Have no means to return Australia. Had to take a loan from my family overseas to survive. I was full time trader - pretty bad one as I have lost almost everything in a such stupid way.
> 
> 
> 
> 
> unfortunately I can not help you guys in Australia, but thanks for your effort and hard work.




Mate,

As one who many years ago was taken in similar fashion may I suggest the following.

1. You will be lucky to see 50% of your money ( I got 60% and recovered )

2. It doesn't matter how sophisticated an investor/ trader you were, someone else has your money.

3. It is a lawyers picnic.

4. It is an accountants picnic.

5. Read forums such as this as people were suss about MF and their model, so you don't make the same mistake again.

As Oscar Wilde I think said, "Losing one wife is tragic, losing two is pure carelessness.

Best of luck with your endeavours, settle soon and early and for 50% plus.
Otherwise spend years bitter and not in control of your destiny.

gg


----------



## hatton01

Hi GG,

I think before you make statements like "you will be lucky to get back 50% of your money" you should check the facts ? Surely you dont want to make it any worse than what it is for mmis4168 or for that matter any other MF client.

Here is a link to Brent's URL. He is keeping a tally of the funds returned:

http://www.indextrader.com.au/images/OTC_Pool_Estimate_24_Nov_2011.GIF

For example in the CFD pool we are now short by $17 Mil out of a total of $84 Mil.

Thats 81% returned not 50%.


http://www.indextrader.com.au/images/Exchange_Pool_Estimate_24_Nov_2011.GIF

In the futures pool 67% of the money has been returned. 
36M belonging to the futures pool is still held by the ASX who want an agreement with MF (UK) to release the funds to the local MF.

We also know where the missing funds are ie: with the counterparties.

There was no fraud or theft at MF (Aust) like with Sonray where clients will end up with 67 cents in the dollar!


----------



## Garpal Gumnut

hatton01 said:


> Hi GG,
> 
> I think before you make statements like "you will be lucky to get back 50% of your money" you should check the facts ? Surely you dont want to make it any worse than what it is for mmis4168 or for that matter any other mf client.
> 
> Here is a link to Brent's URL. He is keeping a tally of the funds returned:
> 
> http://www.indextrader.com.au/images/OTC_Pool_Estimate_24_Nov_2011.GIF
> 
> For example in the CFD pool we are now short by $17 Mil out of a total of $84 Mil.
> 
> Thats 81% returned not 50%.
> 
> 
> http://www.indextrader.com.au/images/Exchange_Pool_Estimate_24_Nov_2011.GIF
> 
> In the futures pool 67% of the money has been returned.
> 36M belonging to the futures pool is still held by the ASX who want an agreement with MF (UK) to release the funds to the local MF.
> 
> We also know where the missing funds are ie: with the counterparties.
> 
> There was no fraud or theft at MF (Aust) like with Sonray where clients will end up with 67 cents in the dollar!




That is good.

Let us hope that is how it pans out.

gg


----------



## hatton01

Have written to many politicians & I was getting frustrated from not hearing back from any of them. Finally an email back from Andrew Robb. 


Dear xxxxxx



Thank you for your email regarding the administration of MF Global Australia.



I understand your frustration with the administration process. The process of disbursing funds during administration can be slow and when there is a shortfall of funds, as may be the case in this instance, the process can be further delayed as the priority of creditors is determined.



The office of the Shadow Assistant Treasurer Mathias Cormann has contacted the administrators, Deloitte, and urged them to conduct the administration in a prompt and efficient manner to ensure that client funds are returned as soon as possible.



We will continue to monitor the situation to make sure that undue delays are avoided.



Thank you for bringing this important matter to my attention. Please feel free to stay in touch with my office.



Kind regards,



Andrew Robb


----------



## Garpal Gumnut

hatton01 said:


> Have written to many politicians & I was getting frustrated from not hearing back from any of them. Finally an email back from Andrew Robb.
> 
> 
> Dear xxxxxx
> 
> 
> 
> Thank you for your email regarding the administration of MF Global Australia.
> 
> 
> 
> I understand your frustration with the administration process. The process of disbursing funds during administration can be slow and when there is a shortfall of funds, as may be the case in this instance, the process can be further delayed as the priority of creditors is determined.
> 
> 
> 
> The office of the Shadow Assistant Treasurer Mathias Cormann has contacted the administrators, Deloitte, and urged them to conduct the administration in a prompt and efficient manner to ensure that client funds are returned as soon as possible.
> 
> 
> 
> We will continue to monitor the situation to make sure that undue delays are avoided.
> 
> 
> 
> Thank you for bringing this important matter to my attention. Please feel free to stay in touch with my office.
> 
> 
> 
> Kind regards,
> 
> 
> 
> Andrew Robb




Cormann is a good performer, keep it up to him.

gg


----------



## pifouSyd

hatton01 said:


> Have written to many politicians & I was getting frustrated from not hearing back from any of them. Finally an email back from Andrew Robb.



Thank you hatton01
1) for your relevant reply to gg re current status of funds collected
2) for sharing Andrew Robb's reply - I got the same one.
My understanding is that both the government and the opposition have contacted Deloitte expressing their concerns and their desire to see a seedy resolution.
Deloitte must however remain in the boundaries of what the law allows.

Our main challenge at this stage is to agree among ourselves on how to address 3 issues:
- should the cash-only accounts suffer a haircut, considering that the haircut results from account that had open positions?
- how to deal with the slippage experienced between 1-Nov and the date when positions got closed (close, transfer or compulsory close)?
- for instruments who got closed after 1-Nov with a wide range of price, how to deal with the slippage resulting from the allocation of fills to accounts (fill allocated versus weighted average price)?

In terms of process, it is important that:
- everyone expresses how they think
- everyone listens to other parties' arguments
- everyone balances the benefits of starting a legal challenge vs. the consequences of the legal action (delaying funds distribution, legal costs, ...) 

Regardless of the resolution chosen for each of these 3 issues, the best solution is to come up with a common approach that everybody agree with; if not, Deloitte will have to go to Court to seek direction, and if people disagree and start to oppose the proposed plan, this will result in further delays and potential reduction of our funds in the segregated account (to pay for legal and administrators fees "working" to help find a solution we could not find ourselves; we'll have only ourselves to blame).

pf


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## westie

Interesting article:
http://www.businessweek.com/news/20...to-weigh-illegal-use-of-funds-for-margin.html


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## riskapur

Hatton01, pifousyd and all others,

The comments that advise that we as clients of MFGA need consensus are absolutely spot on. What confuses me, however is that Deloitte are saying they need consensus amongst clients of MFGA for allocating haircuts and close out slippage, a methodology for fills etc and to go to court to get this approved before making a partial payment.

However there are enough cash balances in the accounts now to make a decent partial payment before going to court for approval of haircuts, close out prices etc. If we have 67% futures, 81% CFD, 80% FX Margin cash balances in these product pools, we could say with a very high degree of certainty, given that close out prices are now known, that even with close out slippage, haircuts to be allocated by whatever methodology, these cash balances are highly unlikely to drop below 50% in each product pool (the slippages reported so far are nowhere near this high - the main issue now is collection - so theoretically balances should not fall below the above %ages in each product pool now). So the way I see it 50% of all product pools should be easily able to be paid out in cash without the need to find consensus on the above points - this is what seems to have been applied elsewhere in US, Canada etc. If this is the case could Deloitte not have gone to court to get approval on 50% pay out of all cash balances in the last 3 weeks rather than saying that we have to wait till February? Or am I missing something here? 

Can someone please explain why Deloitte need to hang on to this 50% in cash now as a pre-text for future haircuts, close out pricing methodology and slippage to be calculated when the combined effect of all of these have almost zero chance to reduce the product pool balances to less than 50% of what they should be?

If Deloitte are arguing that this 50% (which I think should be paid out) should be maintained in case we all go to court to sue each other as clients of MFGA and the resulting legal fees will reduce the balance below 50% in each product pool - then this needs to be seriously challenged.

With regards to close out prices - if I understand correctly no client account holder with MFGA is guaranteed the price of a fill done after 1 November even if this is on the statement.So if all clients who had open position do not actually know their fill price with certainty, doesn't a VWAP closing price methodology resolve this issue fairly? That way those who might have had an actual profit on close out are not unfairly advantaged over those who would suffered losses on actual lose out (in the event that they were told about the actual close out prices). VWAP close out methodology for clients with open positions I think seems fair given these are circumstances with which we all had very limited control. And if those with open positions as at November 1 still do not know with certainty what the close out prices are for positions in their account - I would hope this should help with consensus in agreeing VWAP

If we can agree on close out pricing methodology ASAP then we will be in a position to see what haircuts need to be applied either in the case of
1) Applying shortfall proportionally to all account holders (with open positions and cash only positions) on 1 November
2) Applying haircuts to open positions only on 1 November

I think we, as a collective group of client holders of MFGA, at that time will be in a better position to make a judgement about which of the 2 haircut methodologies above will offer the quickest and most efficient means of getting a consensus to keep this situation away from the courts and also give Deloitte fewer excuses to drag this on longer.

By the way does it make sense for us to vote to have Deloitte removed as administrators? Or will this involve too much backtracking and wasted time for the new administrator taking over?

If it doesn't make sense then ok, but we need to get narrow date ranges when close out methodology has been finalised - a date on what the effect on haircuts on the accounts will be (based on the 2 options above, given close out methodology agreed), and a date on when we get paid. If Deloitte can't agree to, or meet these deadlines, then we should ask for them to be removed and I think we should tell them this in advance.

If Deloitte are saying that each product group can be split into sub categories causing more complexity - that is rubbish - this is can be shown by a simple matrix based on the different sub categories on what the haircuts would be as long as an agreed close out methodology is adopted. Therefore In my view agreeing close out methodology ASAP between client account holders of MFGA should be the immediate priority. And I think VWAP is the fairest mechanism of doing this.


----------



## hatton01

Before any funds can be returned, the Administrator has to get a court ruling as there are some clients who are now claiming more than what was supposed to be in there trading accounts because of opportunity loss costs etc. Others who think everyone should have to bear the cost of slippage. Others like myself who think we should not be liable for any slippage (as our funds were in cash) & should be paid interest on the balance as that was the agreement I had in place with MF as a Platinum CFD client.

Once we have had our day in court & there is a legal basis on how the distribution can be best made in a fair manner, there should not be any reason why there cant be a full distribution of existing funds. 

If you look at the CFD pool,  85% of the funds our now in cash & earning interest. There has been a lot of misinformation spread about what happens when funds our under Administration. Like the Administrator gettting access to interest payments which is "simply not true". If you think about the Sonray case where there was "Theft & Fraud" & missing funds, clients will still end up getting 69 cents in the dollar thanks to the "Administrator" in this case.

So if you are a CFD client there is an extremely high probability you should get at least 85 cents in the dollar. A far cry from the another "Myth" that was spread that "we will be lucky to get 50 cents" in the dollar & the "money is all gone"!

Canada is not a good example for the early return of funds. The reason it happened in Canada is because there was already something in place for insolvancy, ie: the Canadian Investor Protection Fund. I hope Sonray & MF is the catalyst for the reform agenda that is needed urgently in Australia to protect folks like us from the risks of a broker going insolvant.


----------



## captain black

Some good news for MF Global Hong Kong clients...



> The provisional  liquidators of MF Global's Hong Kong business said on Wednesday they  have won court approval to return HK$500 million ($64.25 million)of  client money, around 40 percent of the total that was held by the  brokerage.



http://www.reuters.com/article/2011/12/15/us-mfglobal-hongkong-idUSTRE7BE0A420111215

The statement by KPMG on the 2nd December stated that the distribution would be made within 1-2 months.

I've already mentioned it a few times but I'll say it again. With a global company like MF it's interesting to compare the priority different countries place on the *prompt* return of client funds.


----------



## pifouSyd

hatton01 and riskapur:

1) do you think getting direction from the Court is the only way? Can't we simply find a solution among ourselves, with the Administrator - there will be arguments and discussions, that's for sure, but wouldn't the prospect of all getting our money quicker be a motivation strong enough to get all of us agree to a reasonable compromise for everyone? At least isolate enough the people who would still not accept the agreement that it might not be worthwhile for them to attempt legal action?

Even if Deloitte goes to court and gets direction (The court would probably follow the Administrators recommendation), what would prevent all the people who disagree to oppose and subsequently lodge claims? The issues will only go away if we engage everyone and work out a compromise.


----------



## hatton01

Thanks Cap Black! I have sent this link to one of the reps on the CC that I am in touch with. Hopefully he will raise this at the next CC meeting on Dec 22.

Looks like KPMG still had to get court approval. I would think the Corp law in HK is very similar to Australia. 

The KPMG folks in HK are obviously very efficient. Its a shame Mr Tony Fay didnt choose KPMG as it would have made more sense as all of the other MF franchises except the US are using them. We might have got a group discount


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## captain black

hatton01 said:


> Thanks Cap Black! I have sent this link to one of the reps on the CC that I am in touch with. Hopefully he will raise this at the next CC meeting on Dec 22.




No probs, here's the link to the Dec. 2nd statement giving the 1-2 month indicative time frame. Note that they have approx 80% of funds and are releasing about half of that figure. Deloittes seem to be pushing hard on this idea of heated arguments between client groups. I see little mention of this by other administrators in other countries in their client notices. Make of that what you will.

http://www.kpmg.com/cn/en/PressRoom/Pages/statement-20111202-MF-Global.aspx


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## pifouSyd

We are ready to launch the web site for Clients. We'll likely launch sometimes tomorrow - watch this space. The website will be created under the umbrella of a non-for-profit association.

I need a volunteer to create a Facebook page in addition to the web site, which will be used to inform clients, support those in serious financial difficulty or serious emotional stress, and engage clients to work out a compromise. The person would work under guidance of the team managing the association and should be available to monitor the Facebook page after it's launched.

Any one interested please contact me on  mfga.csg@gmail.com


----------



## riskapur

Hatton01,

Thanks for your reply - much appreciated. Your post is crystal clear in explaining that Deloitte need to go to court to get approval to distribute all the cash that we have in the product pools now. I am still not clear however as to why we cannot get a partial distribution (say 50%) immediately. Yes, Deloitte are saying that some clients are claiming they are owed more than their client balances on 1 November, the closing price methodology and haircut methodology are not finalised etc But the impact of these should not drop balances in each product pool below 50% or so. 

The question is this. For all the excuses Deloitte are making for not making a partial distribution - will the combined effect of these problems result in cash balances in each product pool being less than say 50%. I think this is very very unlikely. Can someone check the claims of these clients that Deloitte say are claiming more than the balances? There is no excuse not to make a partial distribution NOW. HK have done it as well. US has done it, Canada has done it. In the case of MFGA in Australia, you do not need an in insurance or investor protection facility to make a partial now - US don't have one. There is almost zero chance the cash balances in product pools will now drop below 50% even with all the claims, slippages etc  that Deloitte are claiming will happen.

Yes, I know Deloitte need to get this approved by court (lets say 50% partial distribution) but they could have done this weeks ago

Pifousyd, I am not at all suggesting we as client account holders go to court - exactly the opposite. What I am suggesting is as follows

1) Demand that Deloitte seek court order to make immediate partial distribution - say 50% or some % threshold the cash balances will not go below given that we have 67% futures cash balance recovered, 81% CFD, 80% Margin FX. Get Deloitte to get court approved order to make this distribution now as in the case with KPMG in HK.
2) Try and agree on price close out methodology amongst ourselves - I am suggesting VWAP as in my opinion, given the current circumstances, that is the fairest method for all account holders with open positions on 1 November
3) Get Deloitte to adopt the close out methodology agreed between us ASAP and then get an idea of what the haircuts would like in 2 scenarios. Get Deloitte to present the effects of haircuts as follows

a) Haircut applied proportionally to cash only and open positions as at 1 November
b) Haircut applied to only accounts with open positions as at 1 November

Make sure to check and verify from original sources all of Deloitte calculations - it is in their interests to show as big a difference as possible between the results of A and B - creates more division between account holders. Maybe our representative on Creditors Committee can do these checks.

4) We as account holders collectively review haircut scenarios presented then try to get consensus amongst ourselves as to the methodology we choose to adopt.
5) Then we tell Deloitte to get court approved final distribution based on this agreed haircut methodology.

Easier said than done, I know, but it is a suggested starting point. If anyone has better ideas by all means bring them forward but please explain the rationale why this would be better ie how this would get us as much of our money back faster in the fairest possible way


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## captain black

The timeframe for the HK payout looks to be only 2-4 weeks, not 1-2 months. KPMG in Hong Kong are still working through similar issues such as closing price information etc. that Deloittes are yet are willing to make an initial distribution in 2-4 weeks......



> Cowley said the provisional liquidators would be working to making  payments to the majority of the clients in the coming two to four weeks.



http://www.shanghaidaily.com/article/article_xinhua.asp?id=39194


----------



## pifouSyd

CME directors suing Jon Corzine and other MF executives. That will make my day. 
http://online.wsj.com/article/SB10001424052970204026804577100680967560376.html?ru=MKTW&mod=MKTW


----------



## redbin

I'm not trying to be negative here but realistic.

I have said before that the Administrators will not put themselves in a situation where they could be subject to litigation, that is why they must seek direction. 
None of this is about consensus (which you won't get anyway) or fairness, but about legality.
My understanding is that unlike in the US, a judge cannot over-ride legality on the basis of equity, that equity is a different court procedure.
Everyone will have the opportunity to put their legal case at the hearing. What we can hope for is a ruling which also happens to be fair to reduce the risk of appeal. 
Having said all that, I don't see that a partial distribution would jeopardize their position.


----------



## pifouSyd

See attached the updated Futures pool collection as of 14-Dec. 
Money collected is now *71%* of the $208m client gross amount as estimated by Deloitte and presented on 11-Nov.
However the $208m is likely to change, essentially due to variations in positions still open on 1-Nov. For example, according to Deloitte, the additional $9m collected from BNY Mellon are  essentially variations in positions. There could have been some currency effects as well, with the AUD down 5% from 1.05 on 1-Nov.

I also questioned Deloitte why they keep all balances in foreign currency rather than converting everything in AUD. MF Global employees were recommending doing this and the Deloitte person who called me to answer my question confessed of not understanding why the Administrators have not yet decided. Once again Deloitte is not sure what method to use. Meanwhile, until we know how they will convert, it is hard for us to put an efficient edge, having to guess what is best. Again, Deloitte is not understanding a fundamental principle of trading which is the management of risk. Deloitte's indecision is creating (unnecessarily) unmanageable risk.


----------



## hatton01

redbin said:


> I'm not trying to be negative here but realistic.
> 
> I have said before that the Administrators will not put themselves in a situation where they could be subject to litigation, that is why they must seek direction.
> None of this is about consensus (which you won't get anyway) or fairness, but about legality.
> My understanding is that unlike in the US, a judge cannot over-ride legality on the basis of equity, that equity is a different court procedure.
> Everyone will have the opportunity to put their legal case at the hearing. What we can hope for is a ruling which also happens to be fair to reduce the risk of appeal.
> Having said all that, I don't see that a partial distribution would jeopardize their position.



Have to agree with you redbin! And at this stage no one else can do this other than the Admin via the courts. We still have input to the whole process via the CC's for each pool. How much of what they have to say will be taken onboard by the Admin is anyone's guess!


----------



## captain black

hatton01 said:


> Have to agree with you redbin! And at this stage no one else can do this other than the Admin via the courts. We still have input to the whole process via the CC's for each pool. How much of what they have to say will be taken onboard by the Admin is anyone's guess!




I agree too, there needs to be a legal direction given by the court as there has been in every other jurisdiction. But this shouldn't be a reason to hold up an initial distribution similar to what is happening in Hong Kong.


----------



## Trader101

One thing I don’t understand, Why does Deloitte need to wait for all the statement from DBAL before they can go to court with a method of distribution. 

Shouldn’t they come up with a METHOD for working our client balance first and win court approval for this method. and once the method has been agreed then use DBAL statement to work out the balances? 

I mean if the closing trades from DBAL different from what was expected then there wouldn't be a reason to change the method RIGHT?

Why delay this process until after getting all the data from DBAL. Can someone from  Deloitte pls answer this question on the forum if there is a valid reason?


----------



## hatton01

Hi trader101,

Good poinit. If you want an answer pls raise it with the committee (see below):

Q. How can I voice any concerns with the Committee?
A. You can email queries or concerns to mfgaustralia@deloitte.com.au with the subject title,
“F.A.O. Creditors’ Committee”. I will ensure that all of these queries are collated and directed to
the Committee.


----------



## mmis4168

I wish, we could have something like this here

http://www.kpmg.com/UK/en/IssuesAnd... Special Administrators' proposals secure.pdf


----------



## gav

This might put a smile on the faces of a few affected by MFG.



Oh, and I wouldn't want to be Obama at the moment...


----------



## hatton01

Hi Riskapur,

Re your question ie:  "I am still not clear however as to why we cannot get a partial distribution (say 50%) immediately. Yes, Deloitte are saying that some clients are claiming they are owed more than their client balances on 1 November, the closing price methodology and haircut methodology are not finalised etc But the impact of these should not drop balances in each product pool below 50% or so".

The best way to get an answer to this question is via the CC reps.

Some answers that I got from various emails I have sent / received :

1/ In terms of haircuts those of us who did not have any open positions will be treated as a seperate group.

2/ The courts are in recess for the rest of Dec & all of Jan.

3/ Next CC meeting (next Fri) should formalise the close out methodology.

4/ When the courts are open (early Feb) for business the Admin should have everything he needs in terms of reconciled accounts & a methodology. Before the end of Feb I think he will have court approval for the remittance of funds.

In terms of the court process it should be completed fairly swiftly as there is significant pressure on the Admin by both sides of politics to return our funds at the earliest possible time. 

Still I would urge everyone to keep sending those emails / letters to as many politicians (on both sides) as possible.


----------



## pifouSyd

hatton01 said:


> Hi Riskapur,
> 
> Re your question ie:  "I am still not clear however as to why we cannot get a partial distribution (say 50%) immediately. Yes, Deloitte are saying that some clients are claiming they are owed more than their client balances on 1 November, the closing price methodology and haircut methodology are not finalised etc But the impact of these should not drop balances in each product pool below 50% or so".
> 
> The best way to get an answer to this question is via the CC reps.
> 
> Some answers that I got from various emails I have sent / received :
> 
> 1/ In terms of haircuts those of us who did not have any open positions will be treated as a seperate group.
> 
> 2/ The courts are in recess for the rest of Dec & all of Jan.
> 
> 3/ Next CC meeting (next Fri) should formalise the close out methodology.
> 
> 4/ When the courts are open (early Feb) for business the Admin should have everything he needs in terms of reconciled accounts & a methodology. Before the end of Feb I think he will have court approval for the remittance of funds.
> 
> In terms of the court process it should be completed fairly swiftly as there is significant pressure on the Admin by both sides of politics to return our funds at the earliest possible time.
> 
> Still I would urge everyone to keep sending those emails / letters to as many politicians (on both sides) as possible.




I think that one of the reason that could prevent Deloitte to make a partial distribution is the amount of conflicting positions Deloitte has received from various clients, in particular in the futures pool.

As everyone is trying to get the best deal for themselves and "pull the bed cover to themselves", Deloitte is faced with potential litigation claims that could easily exceed the funds in the pool (ie a client with $1m in his account will make a claim for $5m or more, following the advice from his lawyer - it would not take too many such claims to suddenly represent a potential amount of claims that becomes significant); my guess is this one reason (or one valid excuse, depending on how you want to look at it) for not making a partial distribution.

One difference with the US or Canada is that most positions open on 1-nov got compulsorily closed, and/or when transferred, was done in a chaotic way as MF Global licenses got suspended. This is what has created some of the issues which now get people to seek compensation (essentially slippage issues).

While each sub-segment of clients will put very valid arguments - most of them I would agree with if I looked at them on a pure merit basis) - it is this segmented approach that is the largest threat to a seedy distribution of funds, because:
- the issues are complex from a legal perspective: for example, it makes sense to say that a cash-only account should not be penalised by a shortfall caused by margin not repatriated, it is not necessary legal, at least on the basis of the PDS and clients agreements. This will cause counter-claims of people with open positions who will disagree to let the cash-only account holders run with the money first.

This approach by segments of clients is by nature divisive, confrontational and much more prone to internal fighting among clients - which is precisely the ideal conditions for lawyers and Administrators to take over and burn all the money in fees.

I've been advocating for a simpler method looking at the updated account balances and simply distributing what's been collected.
There might be room for some negotiations, like a sweetener for the cash only account holders, eg they would be charged only 80% of the shortfall %, and the other 20% would be paid by those with open positions.
What is very clear is that any agreement among clients will be far far better than a deal resulting from a lengthy legal fight - both in terms of money left to share and time it will take to get what's left.

So we all need to take the helicopter view and ask ourselves:
If I could get 60% to 80% of my funds in 2-3 months, wouldn't that be better than trying to get 90% and in the end, realise 2-3 years later that this was an illusion, and that it would have been much better to get the money earlier.

Just as an example: a fellow trader is expecting the distribution from his funds held with Sonray - he received the notice that the distribution will be initiated soon ... it's now 3 years since his funds have been frozen.

The decision is in our hands - if we start to take segmental positions, I think we are heading in the wrong direction; it may sound like the route of more fairness, it's just a dangerous illusion.

What is 10% of one's funds compared to 2-3 years of funds frozen?


----------



## pifouSyd

hatton01 said:


> In terms of the court process it should be completed fairly swiftly as there is significant pressure on the Admin by both sides of politics to return our funds at the earliest possible time.




I strongly disagree with this opinion - unfortunately, I had this experience myself several times. The court process will not be completed fairly swiftly. Not until there are clients with opposing views. The principle of law sits above the principle of fairness - as long as clients lodge legal complaints that are well argumented, the court must consider them, consider the opposing views, and this is what takes time. Not months, years. Lehman's Brother: 3 years on, no payments. Sonray: 3 years on, no payments.

Make no mistake - there is close to $150m in the futures account. Lawyers and the Administrators (and the Administrators lawyers) know that. This is where the money is. Where to lawyers focus their efforts? Where the money is.

The best way to get our money is to prevent it to be eaten by the lawyers and an everlasting Administration (saw the Ansett Administration - 10 years and $150m later, still going on - this is what happens).

If you think a legal process will be a speedy business think again and seek advice.


----------



## gibson 787

> This approach by segments of clients is by nature divisive, confrontational and much more prone to internal fighting among clients - which is precisely the ideal conditions for lawyers and Administrators to take over and burn all the money in fees.





Totally agree with Pifousyd here.


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## gibson 787

> This approach by segments of clients is by nature divisive, confrontational and much more prone to internal fighting among clients - which is precisely the ideal conditions for lawyers and Administrators to take over and burn all the money in fees




This client dividing process sends shivers up my spine. Divisiveness is absolutely the last thing we need.

The truth is, we all signed our agreements knowing that there could be a shortfall in our account. I am one of those who did not have an open position and do not expect any financial favours.

I vehemently stress to you all, that we as clients need to reach consensus on all issues and keep the legal and administrative professions out of this. As I see it, there are 3 categories of clients - 
                1. those who were not trading
                2. those who were trading and ended up with a loss
                3. those who were trading and ended up with a win

At the end of the day, all 3 categories could have issues with the outcome. My advice is cop it on the chin and take what is there in as short a time as humanly possible. DON'T LET GREED AND SELFISHNESS CANCEL OUT INTELLIGENCE AS IT DID WITH A CERTAIN MR CORZINE. In other words, don't let admonistrators/lawyers decide the destiny of our hard earned. 

I've been on this earth for over 60 years and have been involved on both sides of the fence in issues very similar to this one. There is only one objective for both the administrators and lawyers, and that is to string this out for as long as possible in order to maximise their profit. They are businesses for profit, just like woolworths or Westpac etc. They are not your friends and do not have your interest at heart! 

For us to reach consensus, we have to be able to communicate collectively via email. We know the administrators have the ability to do this, but I'm not so sure they'll be willing to share such ability. Maybe they can be legally forced to, I'm not sure.

What is urgently required are some ideas on how communication can be achieved amongst all clients. Possibly we may have to establish an independent website. I think I may have read here that one is underway.


----------



## landon

Todays Sydney Morning Herald


MF Global fiasco makes case for better client protection
Adele Ferguson
December 19, 2011

More than six weeks after the spectacular world-wide collapse of MF Global, the $313 million pot of Australian client money remains frozen with little hope of a full recovery, as the liquidators, lawyers and regulators try to unravel poor regulatory decisions made worse by the complex world of derivative trading, counterparty risk and the pooling of client money.

Australia's situation is in embarrassingly sharp contrast to some other countries, including Canada, which have been able to repay speedily some or all of client monies.

Part of the problem is due to shortcomings in the regulatory and legislative framework, as well as a decision to grant MF Global an exemption so it could use its British business as the market participant in Australia rather than its Australian business.
Advertisement: Story continues below

It can be revealed this decision has left $34 million of Australian client money in limbo as a legal minefield is set to erupt. The British administrators are expected to argue the funds technically belong to MF Global UK, while the Australian administrator, Deloitte, believes they belong to Australian clients. Until the turf war is sorted out, the Australian Securities Exchange (ASX) has refused to hand over the money.

Put simply, while clients are owed $313 million, there is $232 million in the bank, leaving $81 million outstanding, which is owed by various counterparties. This includes $10 million in MF Singapore, $13 million in contracts for difference (CFDs), $5 million in margin foreign exchange and $1 million in online foreign exchange.

Given the complex situation, coupled with the exemption the Australian Securities and Investments Commission gave to MF Global in Australia, the administrator Deloitte and the law firm Blake Dawson Waldron will have to go to court next year to sort out the mess and get a ruling on how exactly to calculate and return funds.

MF Global collapsed on October 31 after it was forced to reveal it had made a $US6.3 billion bet on European sovereign debt. Some of $US1.2 billion in client money is believed to have been lent to its European affiliate to stave off insolvency. Here lies the problem. Derivatives such as CFDs - one of the key product offerings of MF Global - mostly are traded in the murky and largely unregulated over-the-counter-market, which allows organisations such as MF Global to take client money and pool it into one big account. It is a business model which results in the client becoming an unsecured creditor if the company collapses.

In some cases, these businesses use pooled client funds to meet their daily business obligations in connection with margining, guaranteeing, securing, transferring, adjusting or settling dealings in derivatives. It was this business model that was adopted by Tricom, Opes Prime, Sonray, Chartwell and many other companies in sensational collapses or near-collapses in the past few years.

According to latest Australian Financial Markets Association data, the over-the-counter market turned over $78.1 trillion in the year to June 30, compared with $$49.7 trillion for the total exchange-traded markets, which include the ASX and the Sydney Futures Exchange.

What happened at MF Global can happen again and again until regulators and the government address the issue. I have been highlighting the risks associated with the pooling of client funds since early 2008, when Tricom almost collapsed, followed by the collapse of Opes Prime. Two years later, on July 13 last year, when ASIC came out, guns blazing, with a regulatory guide relating to over-the-counter derivatives, I pointed out that, in the guide, ASIC had failed to deal with the riskiest aspect of these products: a client's money is pooled into one account, the client money can be used for purposes unrelated to that client and, if the company goes under, the client becomes an unsecured creditor.

The MF Global collapse has prompted the government to at least acknowledge the issue with the release of a consultation paper on client monies. It has set a deadline of January 27 for submissions, which covers a period when most people will be on holidays.

The risks of operating in the over-the-counter market are made worse because Australia doesn't have a compensation fund when things go bad. Canada has the Canadian Investor Protection Fund, which has come to the rescue. The futures exchange CME Group in the US has guaranteed $US550 million to the bankruptcy trustee of MF Global to increase the payout from 60 per cent to 75 per cent. In Britain, clients will be paid compensation of up to £50,000 ($77,800) per customer, and administrators have asked customers to make formal claims immediately and will make an interim payment within 14 days of approval, with the aim of completing these before March.

In Australia it is understood no client funds will be returned before April - at the earliest. Customers are yet to be given their closing balance or indication of how much is likely to be returned. Indeed, a court will have to decide this.

It is a situation becoming explosive as some clients get perilously close to collapse the longer it takes. The lawyers and administrators are doing all they can to speed the process. But the longer it takes, the more money they charge and the less clients get. Let's hope this finally gets the government off its backside to make needed changes, including the introduction of a compensation fund.

Read more: http://www.smh.com.au/business/mf-g...-protection-20111218-1p0ry.html#ixzz1gvdCmSu2


----------



## hatton01

If I can summarise from all of the posts, the biggest concern expressed by everyone at this point, is the distribution will be delayed as we wont be able to come up with a single consensus view on the method of distribution ?

What if we signed over something to the Administrator which said we will signoff to any decision agreed to by our Reps on the CC on our behalf in terms of distribution (ie: a proxy vote on the distribution method) ? This would not be hard to implement.


----------



## Trader101

hatton01 said:


> If I can summarise from all of the posts, the biggest concern expressed by everyone at this point, is the distribution will be delayed as we wont be able to come up with a single consensus view on the method of distribution ?
> 
> What if we signed over something to the Administrator which said we will signoff to any decision agreed to by our Reps on the CC on our behalf in terms of distribution (ie: a proxy vote on the distribution method) ? This would not be hard to implement.




Hi Hatton
My biggest concern is that it's not the client’s job to come up with a methodology for distribution. 

It's the administrators job to do this and to do this quickly and by the letter of the law. In HK KPMG has done this in a much short time then Deloittes and I am interested to know the reason for this. 

You are never going to get all of the 50,000 clients to agree on one distribution method (that is a waste of time and money). This is why we hire an administrator in the first place, to make these decisions and push them through the courts. And I want Deloittes to explain to everyone in their next newsletter why they can’t make these decision as KMPG in HK can.


----------



## hatton01

Hi Trader101,

I agree with you a 100%. That's why I eluded to the Reps on the CC.
When the Admin presents his methodology this Fri (22 Dec) they will need to be of one voice. Hoever at the end of the day the Admin will have the final say guided as you point out by the legal position. I doubt very much of a big legal battle over this as there will be some clear legal framework to do the distribution.

There has been a fair bit of negative comments made against Administrators in general (myself included).

However if you look at the Sonray case which happened in June 2010 where the clients were told they would get 25-30 cents in the dollar (CEO went to jail) are now according to news reports going to receive 69 cents. A lot of the credit must go to the Administrator who managed to get some of the parties to provide funds to pay the clients in return for not taking legal action. The Administrator in this case did not eat into the "Client segregated funds" as there would be nothing left by now.


----------



## Trader101

hatton01 said:


> Hi Trader101,
> 
> I agree with you a 100%. That's why I eluded to the Reps on the CC.
> When the Admin presents his methodology this Fri (22 Dec) they will need to be of one voice. Hoever at the end of the day the Admin will have the final say guided as you point out by the legal position. I doubt very much of a big legal battle over this as there will be some clear legal framework to do the distribution.
> 
> There has been a fair bit of negative comments made against Administrators in general (myself included).
> 
> However if you look at the Sonray case which happened in June 2010 where the clients were told they would get 25-30 cents in the dollar (CEO went to jail) are now according to news reports going to receive 69 cents. A lot of the credit must go to the Administrator who managed to get some of the parties to provide funds to pay the clients in return for not taking legal action. The Administrator in this case did not eat into the "Client segregated funds" as there would be nothing left by now.




Thanks Hatton

I think as in the Sonray case it will be long fight, but hopfully the combination of legal action and neg publicity pressure saxo to make a significant payment. Hopefully the same will happen with MF global counterparties. 

Out of interest do we have or adminsttraors any vaild claims from? National Guarantee Fund see link

http://www.segc.com.au/claim.html


----------



## mmis4168

Trader101 said:


> Thanks Hatton
> 
> I think as in the Sonray case it will be long fight, but hopfully the combination of legal action and neg publicity pressure saxo to make a significant payment. Hopefully the same will happen with MF global counterparties.
> 
> Out of interest do we have or adminsttraors any vaild claims from? National Guarantee Fund see link
> 
> http://www.segc.com.au/claim.html




its a joke 

The NGF does not provide protection in relation to futures. The ASX Supplemental Compensation Fund covers claims in relation to money or property entrusted to a participant of ASX in respect of actual or proposed dealings in futures.

and

ASX Supplemental Compensation Fund 
1. Claims in respect of the fraudulent misuse or defalcation of money or property by a single Market Participant will be limited to $1,000,000;

*2. Any series of Claims arising out of the same set of circumstances will be limited to $1,000,000;*

3. the maximum amount payable to any one claimant arising out of a single set of circumstances will be limited to $100,000. In this regard a Claim will be considered to arise out of the same circumstances if it arises out of property having been given or entrusted to a single Market Participant.; and

4. Claims will be pro-rata where the Fund is insufficient to meet all claims.


----------



## Nick29

This is ironic given MFG UK is disputing Australian held cash:

http://www.ft.com/cms/s/0/6b0bbe94-2d76-11e1-b985-00144feabdc0.html#axzz1hPVXCH76


----------



## riskapur

This is one of the reasons we probably won't get all our money back - because of the shortfall in the MFG US accounts and the unlikely ability to collect what MFGA is owed by MFG US.

http://www.zerohedge.com/news/guest-post-run-global-banking-system-how-close-are-we

Basically it comes down to state sponsored theft sanctioned by the US Government and Regulatory Bodies. 

The investigators and regulators know where the money went - to JP Morgan coffers sanctioned by CME. 

Undoubtedly JPM have enough evidence to suggest that CME knew about MFG client money being stolen well before collapse on 1 November. So JPM have CME over a barrel and that is why JPM get to keep the margin calls made with MFG Client money  and neither CME or US government officials can do anything about this. They can't tell the public the truth regarding the complicit and corrupt nature of the CME and regulators (SEC and CFTC) for fear of a run being made on the whole system. 

That is why you get ridiculous decisions made by CME and the Trustee regarding bankruptcy proceedings in relation to MFG being made in accordance with that of an equities firm insolvency instead of commodities brokerage insolvency (as it should have been) allowing JPM to get all their money back first ahead of client account holders.

Suggest take all of your trading money out of any jurisdiction that does not have an investor protection scheme. Might be a good idea to take your money out of JPM as well


----------



## Pager

Thankfully although I had an account with MFG it had very little in it as I only left it open when I changed Broker last year but thought it prudent to leave the account open to save all the hassle of account opening if I needed to use them again.

My sympathy’s to those who look like they will at best lose a good chunk of there account to this scandalous event.

Quite how and why this was allowed to happen in this day and age with all the regulatory bodies in various countries there to so call protect us from the rogues is beyond me, and also highlights how the senior executives at these firms can get away with robbery and win or lose these parasites still get paid, Corzine came out and said he would not seek a severance package for stepping down from MFG, what a joke and the fact he was entitled to one just highlights that these people cant lose, if your average worker f@cks up and is sacked then unless there is just cause they get f@ck all, but a big boss or senior exec automatically gets a $$$$$$$$$$$ payout, then you have the likes of JPM who will gladly take the bailout package from the US taxpayer to save them from the mess they were part of creating but as soon as there is the sniff of a decent profit and fat bonuses for the bosses to screw as much blood out of MFG there like a dog with a bone.

Something very very wrong in our society IMO with the way our financial institutions are allowed to operate and reward themselves at the expense of the rest of us and as for the Regulatory bodies, well there a complete joke.

I also wonder what would have happened if MFG,s big punt on Italian Bonds or whatever it was had come off ?, well there would have been plenty of back slapping and mega bonuses for the boys but what would the clients whose money was used in the segregated accounts have gotten from it ?????, well Nothing, zilch, naff, f@ck all, they would have been completely unaware they were the ones taking the risk but had absolutely nothing to gain, a win win situation for the executives, although Corzine didn’t take a severance package I would bet the other senior executive bastards did and are more than likely already employed in similar roles at other institutions.

Very very sad


----------



## hatton01

Pager, I agree with you that it does not seem fair that Jon Corzine "is still a free man" while all of us will have to take haircut's on our accounts. 

Fortunately for this "scumbag" he lives in country where you are innocent until proven guilty. 

With nine lawsuits, several class actions & ongoing investigations I think Jon Corzine is living on borrowed time. Recently Raj Rajaratnam got 11 years jail time for insider trading. The prosecuters were after a 25 year sentence.

Where will Jon Corzine come unstuck "Falsly stating the second qtr results in Oct" ("when MF Global Holdings Ltd.’s management sent a memo to the securities firm’s 2,800 employees: Start printing on both sides of paper in Sep") or as it is alleged by the CME group "he knew about the transfer of client seg funds".

I know if he does not spend some time in jail, the probabilities are very high that the various civil class actions must surely bankrupt him ?


----------



## westie

This is interesting, sustained client pressure in the UK appears to have forced the local administrator KPMG to implement an early partial distribution.  According to this article possibly this month:

http://www.reuters.com/article/2012...20120105?feedType=RSS&feedName=topNews&rpc=71


----------



## Trader101

westie said:


> This is interesting, sustained client pressure in the UK appears to have forced the local administrator KPMG to implement an early partial distribution.  According to this article possibly this month:
> 
> http://www.reuters.com/article/2012...20120105?feedType=RSS&feedName=topNews&rpc=71




I haven't seen any updated from our administrator for 3 weeks, I thought they were suppose to finalise the distribution method after the creditors meeting on 22nd of Dec. I tried to call yesterday but no once answered - not sure if they are still working on the case.


----------



## Trader101

Trader101 said:


> I haven't seen any updated from our administrator for 3 weeks, I thought they were suppose to finalise the distribution method after the creditors meeting on 22nd of Dec. I tried to call yesterday but no once answered - not sure if they are still working on the case.




Might be a good idea to go down to the office and see whats going on if you are in sydney


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## westie

Given the date of the last CoC meeting I wasn't hopeful of a response before the Christmas break, but likewise I am now beginning to get anxious for an update.

A sceptic could perceive Delloite's timing and delay in response as being deliberate in maximising the turn around and ultimately a distribution using the Christmas break to their advantage.

I would hope to have an update on Monday.


----------



## hatton01

Looks like the office was closed for the Xmas break. 

No timeframe for the release of the CC meeting details from the person I spoke to. 

Have provided some details of this "Nightmare" to a staffer who contacted me from Senator John William's office who wanted more details. 

For those who dont know the Senator has been very active in creating laws to cleanup the insolvency business. Not that I am implying anything here with our Admin Delloite's who seem to be doing everything so far according to the book. Unfortunately everything seems to happen at a a very slooooooow pace. After paying a million dollars I would hope the turnaround would be a lot quicker.


----------



## Trader101

hatton01 said:


> Looks like the office was closed for the Xmas break.
> 
> No timeframe for the release of the CC meeting details from the person I spoke to.
> 
> Have provided some details of this "Nightmare" to a staffer who contacted me from Senator John William's office who wanted more details.
> 
> For those who dont know the Senator has been very active in creating laws to cleanup the insolvency business. Not that I am implying anything here with our Admin Delloite's who seem to be doing everything so far according to the book. Unfortunately everything seems to happen at a a very slooooooow pace. After paying a million dollars I would hope the turnaround would be a lot quicker.




Dear Hatton

I don't know if Admin Delloite's are working very efficiently, if we compare to UK and HK it seem they are a lot slower. Also according to their web site Delloite's Australia was closed for 3 weeks between 24/12/2011 and 08/01/2012. this I think is joke and a insult to all the client who needs these funds to make a living. Do Delloite's not realise that this is one the biggest bankruptcy case in Australia and that thousands of people are waiting for them to resolve the issue?


----------



## traderchris

Agree with you we have heard nothing they should at least keep everyone posted , the longer they leave this the more desperate people will become


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## Trader101

traderchris said:


> Agree with you we have heard nothing they should at least keep everyone posted , the longer they leave this the more desperate people will become




If someone from Delloite's are reading this, can they explain the following:
1/ Why is the administration taking so much longer then Hong Kong and the UK administrators? 
2/ Why are they not answering client questions directly and hiding behind a wall of MF global staff who are shielding them from the difficult questions?
3/ Why are they taking 3 weeks break from the administration process when there is supposedly so much work to be done in calculating client balance, formalising distribution methods and chasing funds from counterparties? How can they justify this, when so many clients depend on these funds to make a living? How come KMPG UK was proving clients with update during this time?
4/ Why are the administrators not being transparent over the amount of fees they are charging for the administrations. Are they charging any fees for the 3 week that their office was closed?
5/ What actions is Delloite’s undertaking to get the remaining balance from DBAL other than ‘having meeting,’ why are they not taking legal action or going to the media about these issues?
Not trying to have a go at you Delloite's but we all just want some answers


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## traderchris

How many MFGA clients are there in Australia that have had their funds confiscated , surely this is illegal ?   Found these articles 

Attorney: MF Global Clients Can File Arbitration to Obtain Lost Money
http://www.lawyersandsettlements.co...terview-mf-global-bankruptcy-diane-17283.html

http://www.indextrader.com.au/Email_9_20111128_Deloitte_Dragging_Their_Feet.pdf


----------



## westie

Just spoke with MF Global operator who advised that we will not get an update until next week on the outcome of the second CoC meeting held on 22Dec.  I was also advised that we can expect to receive a final statement with close out positions next week.  This will form the basis for the partial distribution planned in March/April once court approval and if necessary guidance has been provided.


----------



## traderchris

Thanks for that , any news is helpful at the moment .


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## traderchris

Seems someone its letting the clients know whats going on !!  have obviously been working for the last three weeks in doing so , makes you wonder whats wrong over here in MF Global Australia arm of it ?? they certainly dont seem to have the concern about the clients welfare as the do in the UK or the USA  


KPMG told Reuters on Thursday it had recovered the majority of MF Global UK client monies and virtually all of their assets, valued jointly at about $1.2 billion, and hoped to start returning these to owners shortly

http://www.reuters.com/article/2012...ource=dlvr.it&utm_medium=twitter&dlvrit=56943


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## hatton01

Looks like Deloitte's will be ready to go to court on the 6th of Feb when they open for business to get approval for the distribution. No news so far on the $10 Mil that DBA are holding back to offset losses. Should see a circular next week.


----------



## traderchris

hatton01 said:


> Looks like Deloitte's will be ready to go to court on the 6th of Feb when they open for business to get approval for the distribution. No news so far on the $10 Mil that DBA are holding back to offset losses. Should see a circular next week.




MANY THANKS FOR THAT INFO , much appreciated :shoot:


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## traderchris

MF Global Investor Protections Trampled In Private Meeting Between Government Regulators
In Closed Door Meeting Preceding Bankruptcy Filing, JP Morgan and Goldman Sachs Granted Superiority over MF Global Segregated Accounts

Move Jeopardized Integrity of Futures Markets while Top CFTC Officials Acted As Idle Bystander
It seems ironic that after all is said and done, it was a hasty conference call between government regulators on October 31, 2011 that sealed the fate of MF Global segregated account protections – and placed in jeopardy the integrity of the futures markets.


http://go2managedfutures.com/2012/0...n-private-meeting-with-government-regulators/


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## hatton01

Good to see the circular from Deloitte's at long last.

Nice to see some of the fear that was spread about the Admin dragging his feet to slow things down, using snail mail to get client approval (rather than the online approval process that going to be used) & using the interest from our funds have all been just that.

Just need him to now get the monies being held back by various counterparties & it will be done deal.


----------



## traderchris

traderchris said:


> MF Global Investor Protections Trampled In Private Meeting Between Government Regulators
> In Closed Door Meeting Preceding Bankruptcy Filing, JP Morgan and Goldman Sachs Granted Superiority over MF Global Segregated Accounts
> 
> Move Jeopardized Integrity of Futures Markets while Top CFTC Officials Acted As Idle Bystander
> It seems ironic that after all is said and done, it was a hasty conference call between government regulators on October 31, 2011 that sealed the fate of MF Global segregated account protections – and placed in jeopardy the integrity of the futures markets.
> 
> 
> http://go2managedfutures.com/2012/0...n-private-meeting-with-government-regulators/




thanks


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## traderchris

MF Global trustees need claims forms by Jan 31
WASHINGTON, Jan. 20, 2012 -Farmers and ranchers affected by the collapse of MF Global need to file their claim forms by the deadline of January 31 in order to be eligible to recover lost money
http://www.agri-pulse.com/MF_Global_trustees_need_claims_forms_by_Jan_31_01202012.asp

The SIPA Liquidation of MF Global Inc.
James W. Giddens, Trustee

http://dm.epiq11.com/MFG/Project/default.aspx#Top

Corzine Is Sued Under Racketeering Law by MF Global’s Commodity Customers
http://www.bloomberg.com/news/2012-...g-law-by-mf-global-s-commodity-customers.html


----------



## Trader101

For those that you recieved the notice on Friday, I was wondering why is there 6mil short fall in CFD accounts? Does this mean that 6 mil of client segerated funds is missing as the case in the US? If this is true then where has this money gone, why no details on this from Dellioties 

Secondly I hope the credit understand that both the MF global and Dellioties office in Sydney was closed for 3 weeks during Christmas, this was posted on their company website.


----------



## hatton01

Hi Trader101,
The money is not missing but held back by the counterparty DBA to offset charges / losses (possibly in other MF branches OS). Our Admin needs to make a legal case to get some of the money back from DBA.
TraderChris,
I think if any of us suffer any losses due to this debacle once all of the distributions are made a worldwide class action against JPM might be the next step.


----------



## Trader101

hatton01 said:


> Hi Trader101,
> The money is not missing but held back by the counterparty DBA to offset charges / losses (possibly in other MF branches OS). Our Admin needs to make a legal case to get some of the money back from DBA.
> TraderChris,
> I think if any of us suffer any losses due to this debacle once all of the distributions are made a worldwide class action against JPM might be the next step.




Dear Hatton 

I think with the MF global CFD accounts -looking closely at the table - the client has 80mil of claims, the admin has collected 68 mil of cash and has 13 mil that they believe they will collect (dbal 7 mil is part of this) so total 81 mil of asset but there are also 7 mil of claim that are made against mf glboal australia cfd pool (money that belong to mf global singapore for example) so that is another 7 mil of debt that will be paid from our cah balance, bring the balance to 81-7=74mil so even if the admin collect the 13 mil from all the counterparty (including the 7 mil from dbal) we still have 6 mil of shortfall.


----------



## traderchris

*Worth looking at*

Our only power is to group together.

As individuals we are nothing.

As a group we can become something.

And that is why I have helped to initiate both an association and web site.

We need to go beyond my list and reach more MFGA clients.

We need to connect with as many MFGA clients as possible.

If we can connect with more people then we can start to help communicate what the big risks are.

If we can start to communicate on a broader level then I believe we’ll be able to help facilitate a smoother administration and a smoother court process. And a smoother administration and court process will mean a speedier return of our client property and the less likely hood our segregated accounts will be accessed to pay fees.



A New Association: MF Global Australia Clients Support Group
As you know there has been a core group of selfless people putting in the hard yards to help improve our position. The accumulation of that work has been the creation of an association and its web site.
The association is called MF Global Australia Clients Support Group (MFGA-CSG) and its web site is located at www.mfgaclients.com.au.

In addition, the association has created a Facebook group, where clients can become members. Facebook will be used to share updates regarding MFGA and the progress made with the administration process. The objective is to offer all clients one place to go to stay tuned to the latest news.
You can find the Facebook group by searching for ‘MF Global Australia Clients Support Group’ or go directly to http://www.facebook.com/groups/mfgacsg/


----------



## traderchris

appears that clients in every jurisdiction, apart from us in Australia, have managed to receive (or are about to receive) a partial distribution of their client property (where clients in Canada have received 100% of their account balances).


----------



## pifouSyd

Dear all,
A few MF Global Australia clients have joined forces to form a non-for profit association : MF Global Australia Clients Support Group.
The association has 2 main objectives:
-	Help clients achieve a quick return of their funds
-	Provide assistance to those most affected financially or emotionally
A key element of our action plan is through communication, which we will achieve first through our website and our Facebook group.

Our initial goal is to register as many members as we can in the association – it’s free to join.

The rationale for members to join is that:
-	They will receive more information regarding what’s happening with regards to MF Global Australia
-	They will have the ability to communicate with all other MFGA clients, via the association Facebook group, be it sharing information or discussing various proposals
-	Once the association reaches a critical mass, it will become a legitimate entity whose voice, concerns and suggestions are more likely to be heard, by Deloitte, by the Court, by the media …

We all have the choice of either trusting Deloitte and wait to see what happens or be involved and make sure we keep Deloitte honest. We (founding members of the association) have made our choice.

I strongly encourage you to register to the association (www.mfgaclients.com.au) and also to become a member of the association Facebook group http://www.facebook.com/groups/mfgacsg/
I also encourage you to pass this information to any other MFGA clients you may know.

Best regards, Pierre-Francis


----------



## mmis4168

pifouSyd said:


> Dear all,
> A few MF Global Australia clients have joined forces to form a non-for profit association : MF Global Australia Clients Support Group.
> 
> (...)
> 
> 
> Best regards, Pierre-Francis




Thank you guys for your time and hard work. It is truly appreciated. 

martin


----------



## traderchris

Market Nuggets: FIA Establishes Task Force to Respond to Issues Related To MF Global 

http://www.kitco.com/reports/KitcoNewsMarketNuggets20120124.html


----------



## pifouSyd

mmis4168 said:


> Thank you guys for your time and hard work. It is truly appreciated.
> 
> martin




http://www.smh.com.au/business/mf-global-clients-unite-20120124-1qfoe.html Ben Butler announces the launch of the MF Global Clients Support Group association. Pity he forgot to mention the website address www.mfgaclients.com.au
P-F


----------



## pifouSyd

traderchris said:


> Market Nuggets: FIA Establishes Task Force to Respond to Issues Related To MF Global
> 
> http://www.kitco.com/reports/KitcoNewsMarketNuggets20120124.html




Considering that Goldman Sachs and JP Morgan were the main beneficiaries of the SEC's decision (with tacit support from the CFTC) to select a SIPA liquidation rather than the Commodity Exchange Act liquidation process, we can be confident that the FIA task force (led by Goldman Sachs managing director Michael Dawley) will do its absolute best to better protect market integrity in the future. I think market integrity just does not mean the same thing for different people. For the bank lobby, market integrity means that when they lend $6bn off-balance sheet using clients money in segregated accounts as collateral, they come first to get their money back + interests. Yeah right.

http://go2managedfutures.com/2012/01/sold-out-mf-global-investor-protections-trampled-in-private-meeting-with-government-regulators/


----------



## pifouSyd

To all members of this thread:
It's been great to have the opportunity to exchange views, news and even frustration using this thread. 

I'm not suggesting we stop using it.

However, I would encourage all of you to consider posting on the association Facebook group: MF global Clients Support Group - in addition (or instead of) to posting here.

With access to clients controlled solely by Deloitte (not even the Committee of Creditors has been given access to clients - and what a farce, considering they are supposed to be a representative body) our only chance to get heard as a group is to create momentum and build an association with thousands of clients.

The Facebook group is where the founding members of the association are concentrating their energy.
P-F


----------



## skc

I received my preliminary close out statements last Wednesday and they (I had 3 CFD accounts with MFGA) and of the two positions I had open, the close out prices looked to be in order. One of the positions related to corporate action (capital raising specifically) and they honoured that transaction as well.

So I have confirmed the closing balance using the electronic claim link (which worked without problems). Now I just hope that a smooth court process will lead to a speedy partial payment.

Has anyone noticed anything unusual or contentious about their accounts or positions? 

*To pifou-Syd: *

Good on you guys for starting the support group. I've signed up to your site but I haven't provided the detail details or joined the facebook group. While I support the intent of what you guys are doing, I will be happy to throw my real support behind you when there are real actions to be supported. 

I think joining the facebook group is a pretty big step as people may not want to use their real identify publicly in this matter. So I would suggest not to use facebook as your primary communication channel (or at least use something else in addition to the facebook group).


----------



## peter2

I agree with skc, I support the group but will not signup to twitter or facebook. 

I sent my support of the MGFA-CSG submission to the treasury on Friday night. 

How is it that clients of OTC derivative providers are not informed that there is an inquiry into the use of client monies and segregated accounts? Every account holder should have been notified so that a general consensus could be established. Of course the providers want to continue to make the rules and the interests of clients are not considered. 

Another example of government/regulator ineptitude.


----------



## pifouSyd

skc said:


> I received my preliminary close out statements last Wednesday and they (I had 3 CFD accounts with MFGA) and of the two positions I had open, the close out prices looked to be in order. One of the positions related to corporate action (capital raising specifically) and they honoured that transaction as well.
> 
> So I have confirmed the closing balance using the electronic claim link (which worked without problems). Now I just hope that a smooth court process will lead to a speedy partial payment.
> 
> Has anyone noticed anything unusual or contentious about their accounts or positions?
> 
> *To pifou-Syd: *
> 
> Good on you guys for starting the support group. I've signed up to your site but I haven't provided the detail details or joined the facebook group. While I support the intent of what you guys are doing, I will be happy to throw my real support behind you when there are real actions to be supported.
> 
> I think joining the facebook group is a pretty big step as people may not want to use their real identify publicly in this matter. So I would suggest not to use facebook as your primary communication channel (or at least use something else in addition to the facebook group).




Thank you skc

1) regarding statements: to my knowledge, most people have commented on Facebook that what their statements reflected what they expected.

2) regarding registering on the web site - thank you to all for joining. The more the better. 
The association will have several type of actions:
a) information to the members
b) seeking answers from deloitte - once we can demonstrate that we represent a significant share of clients (this is typically measured by numbers and by amount of funds), it should be easier to have access to them directly.
c) if other actions are required, we'll then seek members support for launching such actions

About 40% of clients have given us the full detail of their accounts - 60% have decided not to. It's a bit of a chicken and egg situation. The association will have more power to act it has large numbers, and members are more likely to support the association if it's powerful. This being said, I believe we should represent around 10% of the funds with the current level of subscription (making an educated guess for the 60% who have not indicated their balance on the website).

I can also say that this information is kept as securely as we possibly can, and is available only to Ross and myself (and the programmer who built the website).

3) Facebook: a lot of people have expressed their concerns regarding joining Facebook, essentially for protecting their privacy. We understand this. We will use direct email communication to members in addition to the information shared on Facebook.
I would like to clarify a few things:
- you don't have to give any personal information on Facebook 
- you don't have to use your real name on Facebook
- if you already have an account on Facebook, you don't have to use this account (ie your personal account) to join the group
- the Facebook group is a "private" group: it means that members have to submit a request which is approved by the Administrator (who can also remove members), and the conversations exchanged in the group can only be accessed by members (they don't spam all your friends)  

I don't want to push anyone on Facebook, I am not a FB junkie, but FB is a free tool that allow us to share information and facilitate exchange of information, reactions, suggestions among members. The association founding group are all volunteers, like everyone else we have limited time, we paid for what had to be done, but our resources are not endless. Facebook was a practical choice. It is comparable to this forum that allows easy dialogue among members. We have now more than 60 members on FB and the level of activity has picked up n the last couple of days.   

If anyone has further questions regarding joining Facebook without having to share their personal information, feel free to email the association at info.mfga.csg@gmail.com


----------



## skc

pifouSyd said:


> Thank you skc




Thanks for the detailed response. I understand your chicken-and-egg problem. 

I never thought about setting up a separate account to join the facebook group... I will do that just so I can be more informed about the developments and what others are thinking.


----------



## baby_swallow

"MF Global trustee has traced most missing funds
Trustee hopes to distribute more funds ‘as soon as possible’"

http://www.marketwatch.com/story/mf...-most-missing-funds-2012-02-06?dist=afterbell


----------



## merc

JIM Taig, of Seismo , sent potential creditors an email today, outlining how to give him the ability to put representative numbers under his authority (proxy for your account) so that he may have the numbers to be allowed to sit in on the next creditors meeting AND get allowed to sit in on the panel that will decide how to proceed. It is important that he get to sit in on this panel....so that he knows exactly what is happening. The more clients he represent, the better chance he is allowed to sit in on what is going on. 
Very complicated he says....and we need a voice.
I suggest you contact Seismo to get a copy of the proxy form and explicit instructions as to how to give him your creditor proxy.....
He has asome skin in the game.......so he will be working for you.
Contact   
trade@seismo.net.au
Proxies must be in by tomorrow March 1 ........4 pm

sincerely,

Merc


----------



## hatton01

I wonder if DBA is going to give us (CFD-Clients) interest on the money they were witholding & now decided to return?


----------



## Pager

I see that some of the execs who were running this sham of a company could still be getting a nice bonus payment out of it 



Seems to me that if these people had done there job in the first place, Clients might never have been left high and dry, and now looks like the executives rank ahead of them and will be able to dip into the pot with what remains of the frozen accounts for a fat bonus cheque, F@cking joke, not to mention another kick in the teeth for the small investor if you ask me 

http://www.businessweek.com/news/20...saw-company-may-get-bonuses-if-court-approves


----------



## hatton01

Its all starting to look a heck of better now considering the doom & gloom some posters
said would happen to us MF Global clients!

A part of the article in the SMH about investors wanting to buy out australian MF Clients !

VULTURE investors are offering to buy out Australian clients of failed broker MF Global, the company's liquidator has confirmed.

Deloitte partner Chris Campbell said he did not know who made the approaches, which came from a Britain-based broker.

The approaches follow on from a bidding war for MF Global client positions in the United States, where rival banks are offering up to 91 ¢ in the dollar.

''I'd be surprised if it is truly 90 ¢, but if they offered me 90 ¢ on the US money that we're trying to recover, I'd have to take it to my committee [of creditors] for approval,'' Mr Campbell said.


----------



## edman79

hatton01 said:


> Its all starting to look a heck of better now considering the doom & gloom some posters
> said would happen to us MF Global clients!




I appreciate your optimism hatton01, do you know something I dont know?
We are currently 4.5 months after we lost our money, not a cent has been paid out. Delloitte going to court to try to get access client money and segregated accounts.
I have no experience in court matters but they seem to adjourn matters at the tip of a hat... 30 odd million(?) in futures funds are being disputed by MFG UK. 

Are we likely to get any funds distributed in the near future?

I'm not trying to entice fear but I feel in the dark about what may happen on Monday.


----------



## skc

edman79 said:


> I appreciate your optimism hatton01, do you know something I dont know?
> We are currently 4.5 months after we lost our money, not a cent has been paid out. Delloitte going to court to try to get access client money and segregated accounts.
> I have no experience in court matters but they seem to adjourn matters at the tip of a hat... 30 odd million(?) in futures funds are being disputed by MFG UK.
> 
> Are we likely to get any funds distributed in the near future?
> 
> I'm not trying to entice fear but I feel in the dark about what may happen on Monday.




I am with you Edman. This whole administration process has been a complete nightmare for account holders. 

If someone offers me 70c in the dollar I will accept straight away.


----------



## skyQuake

skc said:


> I am with you Edman. This whole administration process has been a complete nightmare for account holders.
> 
> If someone offers me 70c in the dollar I will accept straight away.




Really?

If someone offered me 70c in the dollar for MFG I'd suddenly be very suspicious of information asymmetry! Probably bid 70.5c


----------



## skc

skyQuake said:


> Really?
> 
> If someone offered me 70c in the dollar for MFG I'd suddenly be very suspicious of information asymmetry! Probably bid 70.5c




Really. 

Remember my situation is slightly different. With a great deal of good fortune, I got just under 90% of my capital out when MFG's share price first crashed on Tuesday (they went into administration on Monday the following week). 

So for me leaving 30% of what is left (which is still very substantial) is a small price to pay for moving on.


----------



## Edwood

http://www.kpmg.com/UK/en/IssuesAnd...Global_UK_Ltd_Unsecured_Company_Creditors.pdf


----------



## pifouSyd

I'm not sure what they know that we don't. 

One thing probably to consider is that if a 3rd party buys a big chunk of claims, then
1) this 3rd party will probably find it easier to be represented in the legal process
2) has a common and simple objective (instead of the potentially conflicting objectives of each of the initial clients); this objective is not to achieve 100%, but to make the max profit in the shortest amount of time (ie recovering 80c if they paid 70c)

If we assumed for argument's sake that such a 3rd party managed to buy 100% of the claims (hypothetically), then that party would sit with Deloitte and find an agreement with Deloitte without having to go through a lengthy court process.

What's killing us is the perceived/induced/real clients division and the risk (perceived/induced/real) for the Administrators to get personally sued. Once the risk is unequivocally removed, there is no more justification for a lengthy legal process.


----------



## hatton01

The reasons for my comments are simple.
We have gone from  "you not going to see a dime" , "the administrator is going to get all of the interest" etc to investors wanting to buy mf global client accounts!
The money has been found in the US & in the CFD pool I think we are probably close to 95% of the funds have now been returned.
I am sure in time the UK will stop trying to get there hands on local futures funds sitting at the ASX. 
I am also aware there is at least one large investor being represented in Court by one of the best in the business so I think we will come out of this a lot better than what folks expected.


----------



## peterfootwork

Any news from yesterdays, court appearance, for the pooling groups ect  ?
I hope it would have just been a judge giving his decree, or is one of those long winded affairs?


----------



## peterfootwork

Try this on for size................ http://www.smh.com.au/business/liquidator-confirms-mf-global-buyout-20120314-1v3hl.html


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## hatton01

The news is not good mate in terms of seeing the distribution happening any time soon.
The hearing date has been set to the end of June 2012. 

The laws in place for client seg funds need to be changed. The current Fed Govt who I helped to elect have done nothing. They have been sitting on there hands for many years. 

As Gerry Harvey said last night on lateline, both sides are just as useless & really waste taxpayers money.


----------



## arnie78

feel sorry for all the mf global customers. I was going to become a client jeez lucky i didnt. What a complete mess. Its always the same, the administrators, legal crap artists and the rest will make a killing. Just like the lehman brothers scandal."PricewaterhouseCoopers has earned record £322m from Lehman collapse".

Hope all you guys get your money back...

Atleast some good news

http://www.bloomberg.com/news/2012-...n-in-mf-global-u-k-client-cash-kpmg-says.html

cheers


----------



## sammy84

Aren't we meant to be getting some money soon?


----------



## hatton01

Are any MF-Global clients planning to sell your accounts ?
My thoughts are why do this now when the 4 day hearing is only a month away & in the case of the CFD pool 90%+ of the funds are back ? Surely the guys at Mac bank are going to make money on your accounts (at 80 cents they have already made a 10% profit) & thats why they are planning to buy it.
Also when this is done there will be a chance to join in a class action.


----------



## skc

hatton01 said:


> Are any MF-Global clients planning to sell your accounts ?
> My thoughts are why do this now when the 4 day hearing is only a month away & in the case of the CFD pool 90%+ of the funds are back ? Surely the guys at Mac bank are going to make money on your accounts (at 80 cents they have already made a 10% profit) & thats why they are planning to buy it.
> Also when this is done there will be a chance to join in a class action.




The risk of the buyers are mostly time-based. 
1). There is no guarantee that the court hearing will reach a conclusion in those 4 days.
2). Are further appeals / disputes possible?
3). How soon will be funds be paid out?
4). How much will be paid out?
5). Will the money that are currently outstand ever be paid back to MFGA? 
6). Will the full 100% ever be paid out?

From the point of view of the buyers, they are obviously expecting a reasonable outcome at the court hearing, but there are no guarantees.

Say the buyer pays 80c in the dollar and also the $2.5k delotte gouging fee, assuming a $100k account, their outlay is $82.5k against a potential reward of $17.5k. So it's a potential return of 21.2%. If the court hearing results in a meaningful proportion of funds being released soonish (say 60% by August), their risk reward is further enhanced. They can potentially be rewarded with $17.5k while outlaying only $22.5k (as $60k is paid out relatively quickly). With that kind of return, they can manage to wait another 2 years and still make a good annualised return of their invested capital. 

The question is, if you get that $80k back this week, can you trade $80k back to $100 before the debt buyers do? Alternately, ask yourself if you would take the other side of the trade... that is, would you be buying the debt if you had the capital?

Personally I am a willing seller at >80c. It brings closure and certainty, I can write off the loss this financial year, and I back myself to be able to make my profits back before the buyers would. Letting the buyers make a profit is not that big a deal to me.


----------



## sammy84

skc said:


> Personally I am a willing seller at >80c. It brings closure and certainty, I can write off the loss this financial year, and I back myself to be able to make my profits back before the buyers would. Letting the buyers make a profit is not that big a deal to me.




I take it you haven't sold yet though? I too would be willing to sell but haven't had any approaches yet. Have only heard rumours.


----------



## skc

sammy84 said:


> I take it you haven't sold yet though? I too would be willing to sell but haven't had any approaches yet. Have only heard rumours.




It's moved on a lot from just rumours.

No one is going to approach you, you will need to approach them. 

PM me your email and I will send you some info.

Go join up the MFG client support group and you will be on their mailing list. You will need to fill in all the details because there have been cases of fake clients joining.

http://www.mfgaclients.com.au/


----------



## hatton01

If any MF Clients are worried that the court proceeding are going to drag on read the "Amended Originating Process" document available on the Delloites website.
Chris is really asking for direction on certain questions like the question of pooling client segregated funds. I think this is more like a procedure the Administrator has to go through before distributing our funds back to us.
If you are planning to sell up at least wait till you see the outcome of the court hearing.


----------



## skc

hatton01 said:


> If any MF Clients are worried that the court proceeding are going to drag on read the "Amended Originating Process" document available on the Delloites website.
> Chris is really asking for direction on certain questions like the question of pooling client segregated funds. I think this is more like a procedure the Administrator has to go through before distributing our funds back to us.
> If you are planning to sell up at least wait till you see the outcome of the court hearing.




I am not familiar with the court process. I know the Administrators are asking for directions, but the two questions I have no idea about are:

1. Will the court definitely make a direction within those 4-days of hearing?
2. Can the court's decision be subjected to further appeal?

The price the buyers are willing to pay will definitely change after the court hearing. It will go up if monies are coming out soon, and it will go down if the process drags on further. So waiting is to take a view on the court's likely outcome. 

Would someone familiar with the court proceeding be able to comment?


----------



## skc

sammy84 said:


> I take it you haven't sold yet though? I too would be willing to sell but haven't had any approaches yet. Have only heard rumours.




Sammy, I seem to have lost your email in my inbox for some reason.

PM me again if you want more info. 

BTW your mailboxes are full.


----------



## hatton01

1. Will the court definitely make a direction within those 4-days of hearing? 

If you look at similar hearings (like in HK which have similar Corp law) the courts did not drag the process. Chris's legal team already has the answers they want the courts to sign off on it.

2. Can the court's decision be subjected to further appeal? I dont think so.


----------



## banco

hatton01 said:


> 1. Will the court definitely make a direction within those 4-days of hearing?
> 
> If you look at similar hearings (like in HK which have similar Corp law) the courts did not drag the process. Chris's legal team already has the answers they want the courts to sign off on it.
> 
> 2. Can the court's decision be subjected to further appeal? I dont think so.




2.Of course it can.  If someone had standing they could file an appeal.


----------



## ruliann

Hi

I m french customer of broker WHSelfinvest, and like you, I am a victim of MF Global.

WHSelfinvest worked with MF Global UK.... 

Now, WHSelfinvest choose Macquarie UK for our deposits (future accounts).

the liquidator of MF Global (UK) is KPMG, and like you, MFG UK customers have not received any transfer. 0 !

KPMG promises us a first payment of 26.9% for weeks...! We are still waiting ...

I stand in solidarity on your forum and for propose to you 2 another forums, if you're interested :

- http://mfgukclients.org/?page_id=268
- http://www.pro-at.com/forums-bourse/bourse-257-34161.html

You have problems with Deloitte, and KPMG for us!

results to date:

-Canadian > 100% :bananasmi
-Singapore > 90%   
-US > 78-80%  :alcohol:
-Australia and UK > 0   




*sorry for my english guys


----------



## hatton01

2. If someone had standing they could file an appeal.

1.My thoughts are it is not in any mf clients interests to drag the court process! It is counter productive.
2.You have to have dip pockets to get legal representation to appeal the court process.
3. All of the issues are fairly clear cut. There are specific corp laws to guide the Judge. 
4. The folks trying to get us to sell our accounts are quoting the cases of Sonray & Lehman Bros. These are bad examples as no money was lost due to fraud in this case. With the CFT side close 90% to 95% of the funds our back.
Funny how no mention was made about Singapore or HK where money was returned after the court process. These two countries have similar Corp laws.

The fact the Mac Bank want to buy our accounts tells me there is an extremely good probability the money will be returned very soon. I say dont sell.


----------



## banco

Depends what you define as "very soon".  There's a very good chance the Court will reserve it's decision (basically take time to think it over) and the result won't be known for months.


----------



## skc

hatton01 said:


> 2. If someone had standing they could file an appeal.
> 
> 1.My thoughts are it is not in any mf clients interests to drag the court process! It is counter productive.
> 2.You have to have dip pockets to get legal representation to appeal the court process.
> 3. All of the issues are fairly clear cut. There are specific corp laws to guide the Judge.
> 4. The folks trying to get us to sell our accounts are quoting the cases of Sonray & Lehman Bros. These are bad examples as no money was lost due to fraud in this case. With the CFT side close 90% to 95% of the funds our back.
> Funny how no mention was made about Singapore or HK where money was returned after the court process. These two countries have similar Corp laws.
> 
> The fact the Mac Bank want to buy our accounts tells me there is an extremely good probability the money will be returned very soon. I say dont sell.




Yes it is in the interest of clients not to drag on with the court process, but I don't trust all 10000 account holders to be fully rational beings. Many small timers with $10k in the account will not take a haircut, because they have no trading skill to earn them back. Deloitte probably doing them a favour by not releasing the funds.

The sonray case was appealed because of the way glv is calculated, although the fruad and subsequent settlement proposal no doubt made the process longer. MFGA has got no fraud, but it has a different dimension by being linked to many overseas parties which complicated the return of funds.

As i said before the buyers are there to make a profit and they are certainly taking a view on the court outcome being favourable. I am however happy to sell base on my own risk/reward appetite. Chances are clients will see some money before Sept, but i am guessing clients won't see the final dollar much later than that. Hopefully for those not selling, that 'some money' turns out to be a substantial portion.


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## pifouSyd

When I see heavyweight like GWF and GrainCorp engaged in the court action, it does not make me comfortable that there will be a speedy resolution. I imagine that there is significant money involved to justify delaying the distribution by lodging their claims to the Court. 
This being said, I find it very hard to guess how long or how short it will be.


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## hatton01

Having traded for over 10 years the current market conditions are not favourable to the trend trader. I think there are very few traders out there who can actually make a living out of trading in the current climate. 

What Mac Bank & the likes are trying to do is make a quick buck out of us. 

When you look at the CFD Seg Account there is 90% to 95% (add on interest payments) of the funds returned why would you give 15 cents to Mac bank for a wait of a few months. The fact that they are willing to pay 10 cents more for CFD accounts also tells me the pools will be treated differently which is a very good thing.

If I was only concerned for my account I would be telling folks to  sell. By selling now you are taking a unecessary hair cut where cash is king right now. 

It is in the interest of some folks to give us the Gloom & Doom rubbish so they can make commissions out of our loss.


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## skc

hatton01 said:


> Having traded for over 10 years the current market conditions are not favourable to the trend trader. I think there are very few traders out there who can actually make a living out of trading in the current climate.
> 
> What Mac Bank & the likes are trying to do is make a quick buck out of us.
> 
> When you look at the CFD Seg Account there is 90% to 95% (add on interest payments) of the funds returned why would you give 15 cents to Mac bank for a wait of a few months. The fact that they are willing to pay 10 cents more for CFD accounts also tells me the pools will be treated differently which is a very good thing.
> 
> If I was only concerned for my account I would be telling folks to  sell. By selling now you are taking a unecessary hair cut where cash is king right now.
> 
> It is in the interest of some folks to give us the Gloom & Doom rubbish so they can make commissions out of our loss.




Can I ask where you get the information on Mac Bank's offer for CFD accounts?

Re: selling... each to their own I guess. The sell/hold decision to me is like another trade, and I am risk-adversed so I tend to sell when I don't have particular insight to support a hold decision. If me selling helps you get your fund returned faster, then we'd both be happy.


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## hatton01

Hi SKC,
Sorry I got the  Mac Bank stuff incorrect. They are only willing to buy (ie: > 100K ) & it is negotiable (I will find out what the going rate is ?).
Mac bank (Sean.kelly@macqurie.com)

However CRT offering 80 cents on CFD accounts. (CRT - ross@andersonsonline.com.au)

Info for the above is via the mf global client support group.

As there is a lot misinfomation about what the court procedure entails, I thought I would speak to my friendly mf global person. Here are the main points:

1/ Court process is only for 4 days. This is where anyone who has a strong case for how the distribution should take place needs to put forward there case  based on the Corp act 2001.

2/ Once the 4 days is up the Judge will consider all of the material submitted & provide the necessary legal framework ('directions') to the Administrator/MFGA to make distributions to the clients. It could be a month or two for the Judge to come back with the 'directions'.

3/ Once the Judge provides directions there is a 30 day period for any party to appeal.

4/ The appeal may or may not stop distributions to a pool / client.
    The appeal will have to be heard again & a Judge will have to provide new directions.

5/ There is a strong probability any interest earned will be paid back into the different pools which will make up some of the short falls. No one else can claim these funds.

6/ CFD pool - 90% has been returned. UK affiliate & DB have to return funds to make it close to 100%.
(I once received the cfd platinum client list by accident. Have to tell you there were not too many names on the list. So I am hoping there wont be too many appeals coming from this pool. Looks like all of the buyers are thinking on the same lines as the difference between CFD & Futures accounts are 10 cents).

7/ There are no previous precedents to this type of administration where there was no fraud. So Sonray adminstration is NOT a good example. 

I still think HK & Singapore MF Global admin is the closest precedent (very similar Corp law) & money was distributed after the court process fairly swiftly.

So if we say the Judge is going to take 2 months + 30 day period to hear appeals we might see a distribution in Oct. At the worst case in time for Xmas.

Hope the above helps in anyway to remain positive that we are getting closer to this nightmare ending & we can get back to trading with the minimum haircut (5% would be nice).
Cheers


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## skc

hatton01 said:


> Hi SKC,
> Sorry I got the  Mac Bank stuff incorrect. They are only willing to buy (ie: > 100K ) & it is negotiable (I will find out what the going rate is ?).
> Mac bank (Sean.kelly@macqurie.com)
> 
> However CRT offering 80 cents on CFD accounts. (CRT - ross@andersonsonline.com.au)
> 
> Info for the above is via the mf global client support group.




Thanks Hatton. I am across the offers out there as per the Client Support Group updates. 

The information you posted are close enough to my understanding as well. There are quite a few variables so people can make their own judgement on those.


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## edman79

SKC have you decided to sell? 
I'd be interested in anyones experience with the banks buying their debt. Has anyone contacted the banks, what price are you selling for and when/how long will it take?


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## banco

hatton01 said:


> So if we say the Judge is going to take 2 months + 30 day period to hear appeals we might see a distribution in Oct. At the worst case in time for Xmas.




Your timeline is a bit off.  They have 30 days to file an appeal.  If an appeal goes to a hearing it will add a minimum of a few months to the process. Then of course they can appeal that decision if they want.


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## hatton01

An appeal may or may not stop distributions to all pools (ie: an appeal re the futures pool will not stop distributions in the CFD pool).
You also have to have sufficient means to get legal representations to make appeals.
The appeal has to be based on Corp law.

So for instance in the CFD pool where not too many clients had a/c balance > 100K ,  the probability of an appeal is lower say to the futures pool where there were a lot more clients > 100K accounts.

I like to focus on the positive & if you look through my posts so far, I have only been wrong on the timeframes.


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## skc

edman79 said:


> SKC have you decided to sell?
> I'd be interested in anyones experience with the banks buying their debt. Has anyone contacted the banks, what price are you selling for and when/how long will it take?




I am quite committed to sell at the right price. But remember that my circumstances are unique to me and so while it may be the right decision for me to sell, it may not be the right decision for someone else.

My account balance at time of administration was only ~12% of my trading capital. So even if I take a 25% haircut on that it is literally only worth several bad trades. Plus if the sale is settled before 30 Jun, the after tax impact is no more than a few %. So it is a simple decision for me because of that. 

If I did have 100% of my trading capital in there, however, it would be a substantially more difficult decision and my stance on selling now may be different.

I have contacted a couple of buyers... one has offered a price that I deemed too low and another is working on the paperwork to satisfy the Deloitte's processes, hopefully this week.



hatton01 said:


> I have only been wrong on the timeframes.




Time is in fact the variable that matters the most. As I said, the sell decision really depends on one's anticipation of the court process timeframe + his/her own opportunity cost.


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## hatton01

Any ideas when we might hear what happened in the courts this week ?


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## hatton01

Saw this in the Age. 

The last line "clients should receive between 68 per cent and 100 per cent" is encouraging!

THE local fallout from the collapse of international derivatives trader MF Global is being played out in the New South Wales Supreme Court, where the liquidator, Deloitte, is asking how it can allocate available sums to clients who are owed $309 million.

Twenty-one barristers lined up before Justice Ashley Black, representing the liquidator, and the interests of 11,000 individual clients who held 16,000 accounts with MF Global Australia.

Fabian Gleeson, SC, said when the firm was placed in administration on November 1 last year, $150 million was held in accounts. The liquidator has been able to recover $82 million of the $167 million owed by counterparties, and ''there are some substantial recoveries to come'', he said. A further $30 million in futures money held by the Australian Securities Exchange was being claimed by both the British and Australian liquidators.

MF Global, one of the biggest bankruptcies in US history, left clients stranded after it admitted to using $700 million from client accounts to fund a liquidity shortfall brought about by a multibillion-dollar bad trade it made for itself on European bonds.

Deloitte has estimated clients should receive between 68 per cent and 100 per cent. Unsecured creditors were set to receive between 6.6 ¢ and 18.5 ¢ in the dollar.

The hearing continues.


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## CanOz

Has anyone gone to jail for this massive fraud yet? Or is this waste of a human heart still in court trying to somehow defend himself???

Really sh**s me...:frown:

CanOz


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## Robbo

CanOz said:


> Has anyone gone to jail for this massive fraud yet? Or is this waste of a human heart still in court trying to somehow defend himself???
> 
> Really sh**s me...:frown:
> 
> CanOz




Corzine is a politically connected democrat who has been praised by Obama and Biden and has previously raised a truckload of cash for their reelection. IF anything happens and thats a very big IF, you can almost guarantee it will be after the US presidential election. That said I wouldn't hold my breath, seems to have dodged quite a lot of punishment for scandal and stupidity in the past (including near death after not wearing a seatbelt going at ~140K/PH with lights and sirens and getting into a crash on the way to the governors mansion to broker an apology between a radio host and a womens basketball team, some emergency! Oh and cheating on wife as governor, putting mistress on govt payroll etc)


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## CanOz

Robbo said:


> Corzine is a politically connected democrat who has been praised by Obama and Biden and has previously raised a truckload of cash for their reelection. IF anything happens and thats a very big IF, you can almost guarantee it will be after the US presidential election. That said I wouldn't hold my breath, seems to have dodged quite a lot of punishment for scandal and stupidity in the past (including near death after not wearing a seatbelt going at ~140K/PH with lights and sirens and getting into a crash on the way to the governors mansion to broker an apology between a radio host and a womens basketball team, some emergency! Oh and cheating on wife as governor, putting mistress on govt payroll etc)




I used to think only the Republicans were the evil empire, but you know its the money, its makes them all truly do EVIL things. I feel so bad for the American people, a wonderful bunch on the whole...But oh do i hate their government!

I really wish they could change things. They really are no better than a second world political system now.

CanOz


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## hatton01

According to a MF Global source the court hearing went according to plan.
We will now have to wait for the Judge to come back & then wait 30 day's for any appeals to his directions.
We should be receiving an email soon from the Admin.
Lets hope for all concerned its an early Xmas present & we get very close to a 100% return for those holding cash positions.


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## Pager

This link to an audio interview about MFG and another broker PFG Best who has just gone under with $$$$$$$$$ client funds missing, was posted on another forum but thought I would post it here and incredible to think that after MFG its been allowed to happen again, NOTHING has changed, if you trade futures and particularly the US markets you will find it both interesting and very disturbing, your money aint safe.

http://www.financialsensenewshour.com/broadcast/fsn2012-0714-3.mp3

As to the regulators in the USA, saying they are incompetent is being kind.

Also incredible to believe that since 2008 although many chargeable offences have been committed by the big financial institutions and brokers but NOT 1 of them and NOT 1 person has been prosecuted, charged or held to account, even John Corzine is free and currently running fund raisers for the PRESIDENT of the United States even though as much as a billion dollars is still missing.

Seems to me if your very rich or politicly powerful or a big institution in the USA then your chances of prosecution for theft, deception, lying and f@cking peoples lives is very very low, talk about a cartel over there running things, when President Reagan famously described the Soviet Union as the Evil Empire he had that so wrong, the Evil Empire is based on Wall Street, New York


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## hatton01

I have made a few calls to the MF Global desk about when we might be hearing from Justice Black.
The only clue about a possible date may be in the Aug 3 update where Chris has asked the MF Global Trustee to grant an extension to 30 Sep so he can provide provide the information from the judgement.
So maybe another 7 weeks of waiting ? I sure hope we all get our funds back by Xmas at the very least.
I wonder what the costs are for 1 year's administration.


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## edman79

Yes I found that extension date a bit worrying as the original date was 3 weeks after the hearing. Now the date is in 2 months time. So originally it was deemed that 3 weeks (possibly less, pending the decision) was enough time so I can only guess from the extension that a decision is not coming in the near future. Wouldnt have thought it would be that hard. I really cant see how the FX clients didnt receive their money back as they had over 100% according to delloittes, whos disuputing that?


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## hatton01

Hi Edman,
I did not realise Justice  Black had given a timeframe by which  he would provide directions on this case.
If the timeframe was 3 weeks since the hearing then it should be any day now which is even better ?

As for the futures funds all I know is there is 34M of Aust client funds tied up at the the ASX which the special Admin in UK (MFGUK) is trying to claim for its clients (I don't  get it!!!). 

MFGA to provide a statement  by the 31 Aug to the Fed court & MFGUK to respond by the 28 Sept. Its a pity the Admins couldn't reach a decision without going to Court. 

I know some treasury papers are being discussed right now to prevent CFD providers using client funds for hedging/margin etc. A bit late for us but nevertheless progress in the right direction to prevent the same thing happening again. What I would like to see happen  is a Investor Protection fund which Canada have  had in place for brokers going under. Canadian MF Clients received 100% of there money back within a few months thanks to the fund.

Pls continue to update this thread as this may be one of the last remaining sources for MFGA info.


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## Illiquidx

IlliquidX is a financial services boutique specialised in providing access to holders of illiquid and distressed assets to the secondary market in a transparent, efficient and regulated way.
We have executed transactions in excess of $3 billion in claims globally and consistently provide liquidity in today’s volatile market to numerous claim holders. IlliquidX ensures seamless and timely settlement. 

Please contact Celestino Amore on +44 2 078 320 181 or at amore@illiquidx.com if you are interested in selling your MF Global Australia claim.


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## Edwood

http://dealbook.nytimes.com/2012/08/15/no-criminal-case-is-likely-in-loss-at-mf-global/ 

amazing if he can escape then go off & create a hedge fund!


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## mmis4168

thanks to J

The NSW Supreme Court’s decision on Wednesday on the distribution of up to $310 million owed to clients of collapsed broker MF Global Australia is unlikely to be the end of the matter, with parties already preparing to appeal if the ruling is unfavourable.

Sources involved in the litigation process said the return of funds to some clients could drag on well into next year, because there would inevitably be “big winners and losers”.

MF Global Singapore is owed about $16 million from its Australian affiliate, while there are other companies and traders who are owed large sums and have the financial clout to appeal.

About 11,000 clients have not been able to get their funds since November 1 last year, when the local arm of MF Global went into liquidation after the bankruptcy of its US parent.

The local broker’s liquidator, Deloitte, has recovered about $240 million of client funds but has declined to provide an interim distribution without court approval.

There are about 10 parties involved in the court case, including representatives of contracts for difference (CFD) clients (owed $80 million), futures traders ($212 million), margin foreign exchange clients ($16 million), non-client creditors, cash-only clients, and Deutsche Bank and GrainCorp.

It is understood the judge will ask the parties to agree to his initial orders, before giving them more time.

Liquidator Chris Campbell of Deloitte said the legal process was designed to limit the likelihood of appeals further delaying the return of client funds.

“It’s going to be very difficult for anybody to mount a challenge,” Mr Campbell said.

“On most of the book I’d be disappointed if we did get an appeal of any significance,” he said.

Mr Campbell said there was a prospect of CFD clients appealing.

A CFD party, MFG Singapore, has claimed it can trace its share of funds to separate bank accounts which no other client had funds in and that the money is being held in trust for it.

Another possible appeal could centre on whether the $46 million recovered from MFG Australia’s prime broker, Deutsche, is client money or funds that belong to MFG’s corporate entity to which unsecured creditors and staff would have claims.

“I don’t know whether it was client money or corporate money,” Mr Campbell said.

“If it’s corporate money then it becomes MF Global Australia’s and the CFD clients miss out on direct access to those funds and have to rank with all the other creditors.”

“It could have a huge impact for CFDs,” Mr Campbell said.

MF Global client Nick Westbrook who has more than $100,000 frozen, said the Australian Securities and Investments Commission and federal government needed to step in and expedite the return of funds.

“The only group who stand to gain from this dragging on is the lawyers and administrators and all the while the reputation of Australiaas a place to invest is being tarnished,” he said.


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## hatton01

Cant believe unsecured creditors trying to access our funds in Segregated accounts. Its good that the concept of the  segregated account has been protected.   

As a cash only CFD client I think in the end it is fair that all clients are treated equally.

The fact that we also get interest on our funds is a move in the right direction.
Just have to wait till the 12th of Sept to find out the timeframe for the distribution.


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## hatton01

More good news for clients in the CFD pool.
I am told Justice Black's recent directions should clear up some of the issues in getting the remaining funds held by DBA adding to the approx 92% in cash. This would only leave the funds from MF UK outstanding in the CFD pool. This would be returned to us in a subsequent distribution.


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## mmis4168

hatton01 said:


> More good news for clients in the CFD pool.
> I am told Justice Black's recent directions should clear up some of the issues in getting the remaining funds held by DBA adding to the approx 92% in cash. This would only leave the funds from MF UK outstanding in the CFD pool. This would be returned to us in a subsequent distribution.




Do you mind if I post it on MF Global Australia Clients Support Group @ https://www.facebook.com/groups/mfgacsg/   (but (it would be great) if you could do it by yourself ) ?


regs


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## hatton01

CFD Pool
1/ Sure no probs. I am not on facebook so cant post the msg.
2/ Interest - I am told the 1.7M earned will be added to the pool rather than each CFD client being paid interest on the balance. May help with any shortfalls.


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## mmis4168

Done. Thank you Hatton01


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## BrianFXman

The other problem is all the people who were running the MF Trading desks are now off trying to pickup their volume generated commissions again at other brokers. 

The regulators dont act until its too late.


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## peterfootwork

Hey guys and girls, just found this one

http://www.asiaone.com/A1Business/General%2BNews/Story/A1Story20121012-377249.html

Cheers


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## IFocus

Any one else been asked to send in a copy of their bank statement.......I only have a $200 in MF not keen to send a statement off to a request


Any thoughts anyone


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## skc

IFocus said:


> Any one else been asked to send in a copy of their bank statement.......I only have a $200 in MF not keen to send a statement off to a request
> 
> 
> Any thoughts anyone




What's the worry there? MFGA had your bank account details and Deloittes is just as reputable.


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## IFocus

skc said:


> What's the worry there? MFGA had your bank account details and Deloittes is just as reputable.





Just that the email was genuine. 


Interesting that I questioned the email and got a reply Sunday from Paul Bennett


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## skc

Exactly 1 year on, client moneys are finally coming out of MFGA. 

Last night I received 78% of my CFD account balance and it is a fanastic feeling to be able to put this saga (mostly) behind. It is amazing that there was no appeal to the court decisions... common sense actually prevailed amongst the thousands of account holders (a true miracle imo).

I understand that futures account got paid out a lower % which is most unfortunate since they aren't even dealing with an OTC product... so it still highlights how crap the system is in protecting investor funds.

For the record I didn't sell my account. I was fine with a buyer offering 80c to my claim, but I didn't sell on the basis that it would be very hard to chase them if they don't pay me as promised. One gets a bit more suspicious about these things when they ahve been let down by the system...


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## ct327

skc said:


> Exactly 1 year on, client moneys are finally coming out of MFGA.
> 
> Last night I received 78% of my CFD account balance and it is a fanastic feeling to be able to put this saga (mostly) behind. It is amazing that there was no appeal to the court decisions... common sense actually prevailed amongst the thousands of account holders (a true miracle imo).
> 
> I understand that futures account got paid out a lower % which is most unfortunate since they aren't even dealing with an OTC product... so it still highlights how crap the system is in protecting investor funds.
> 
> For the record I didn't sell my account. I was fine with a buyer offering 80c to my claim, but I didn't sell on the basis that it would be very hard to chase them if they don't pay me as promised. One gets a bit more suspicious about these things when they ahve been let down by the system...




The Futures account holders got 57cents in the dollar - what a complete joke.  I am guessing that the rest will get chewed up by Deloittes etc in administration fees and the fight with MFGUK etc....  Well not 1cent of the pitiful amount returned to me will be going into a brokerage account for these scumbags to steal again.


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## levine

ct327 said:


> The Futures account holders got 57cents in the dollar - what a complete joke.  I am guessing that the rest will get chewed up by Deloittes etc in administration fees and the fight with MFGUK etc....  Well not 1cent of the pitiful amount returned to me will be going into a brokerage account for these scumbags to steal again.




I received my pathetic 56% distribution yesterday, and Deloittes are going to withhold $40million for costs???

Does anybody know of the timeline for final distributions? Surely this cant be it??


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## ct327

levine said:


> I received my pathetic 56% distribution yesterday, and Deloittes are going to withhold $40million for costs???
> 
> Does anybody know of the timeline for final distributions? Surely this cant be it??




Apparently we should be getting an update today or tomorrow outlining the first distribution and then another update next week on the status of the ASX held funds etc.  I can only hope for all of us involved that this gets resolved quickly and remaining funds are distributed - 1 year and 57cents in the dollar back is not good enough for the Futures clients.  Looks like the other client pools fared considerably better than us.


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## captain black

A good story on lateline business last night regarding MF and client fund protection in Australia (or lack of)

http://www.abc.net.au/news/2012-11-29/the-six-billion-dollar-bust-aussie-investors-are/4399952


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## ct327

Any one out there any idea what the latest (posted on 13/12/2012) judgements mean ?


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## captain black

MF Global clients received another distribution today. Current status of returns is 91% for futures clients and 89% for CFD clients.


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