MF Global Australia - What are you doing?

[skc]

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?

 

[skyQuake]

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

 

[Sir Osisofliver]

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

 

[skc]

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.

 

[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.

 

[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.

 

[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

 

[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)

 

[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

 

[IBTrader]

Interactive Brokers fast tracking all MF Global accounts

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).

 

[McLovin]

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.

 

[Nick29]

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?????

 

[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?

 

[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

 

[notting]

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.

 

[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.

 

[matt07]

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.

 

[Tanaka]

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.

 

[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)"

 

[Nick29]

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?