MF Global Holdings, Ltd. (fka MFGLQ)

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MF Global Trustee Gets $168 Million From JPMorgan
BY AZAM AHMED AND BEN PROTESS
The trustee overseeing the return of customer money following the collapse of MF Global has received more than $168 million from JPMorgan Chase, according to people familiar with the transfer — the first such payment from the bank since the commodities brokerage firm once run by Jon S. Corzine filed for bankruptcy last October.


The money, which was sent Thursday night, is part of the extra collateral that MF Global posted to assuage worried trading partners before it collapsed. As those positions were sold in the aftermath of the firm’s dissolution, the cash was returned to JPMorgan, which facilitated and cleared numerous trades on behalf of MF Global.

The money is not technically part of the $1.6 billion in customer cash that vanished from the firm in its final days, but the trustee, James W. Giddens, plans to use it to repay the farmers, traders and hedge funds who have waited more than six months to get all of their money back.

JPMorgan has been in the center of the controversy surrounding the missing funds, as customers, politicians and federal investigators struggle to figure out how MF Global managed to misuse the cash before collapsing. Indeed, investigators have scrutinized a $175 million transfer the brokerage firm made from customer accounts to JPMorgan the day before it collapsed. The transfer, which was authorized by the firm’s Chicago office, was made to patch an overdraft.

Those funds are not part of the money sent to the trustee, and remain the subject of continuing negotiations, according to people briefed on the matter.

A JPMorgan spokesman declined to comment.