- Posted March 21, 2013
- Tweet This | Share on Facebook
JPMorgan, MF Global trustee reach agreement
NEW YORK (AP) -- JPMorgan Chase has agreed to a deal that will return $546 million to former customers of trading firm MF Global Holdings Ltd., which collapsed in 2011 with $1.6 billion missing from its accounts.
MF Global failed in October after a calamitous bet on European debt spooked its investors, partners and clients. The bankruptcy was the eighth-largest in the U.S. and the largest on Wall Street since the 2008 collapse of Lehman Brothers. Much of the missing money belonged to farmers, ranchers and other business owners who used MF Global to reduce their risks from fluctuating prices of commodities such as corn and wheat. A House panel has said credit rating agencies and federal regulators contributed to MF Global's collapse. But it pinned most of the blame on risky strategies by ex-CEO Jon Corzine, the former New Jersey governor.
JPMorgan Chase & Co. held MF Global funds in several accounts and also processed the firm's securities trades. The trustee tasked with getting customers' money back, James W. Giddens, threatened to sue the New York bank if it didn't return money that was transferred to the bank from MF Global. By June 2012, JPMorgan had returned $608 million to the firm.
Under a settlement agreement filed Tuesday in Manhattan bankruptcy court, JPMorgan Chase has agreed to pay $100 million to reimburse customers and will relinquish claims on $417 million that it previously returned. JPMorgan also will return over $29 million that it is holding as security on an MF Global credit line. The recovered money will eventually be passed along to customers.
The deal must be approved by Bankruptcy Court Judge Martin Glenn and District Court Judge Victor Marrero.
Published: Thu, Mar 21, 2013
headlines Oakland County
- Annual Dinner & Meeting
- FORCE Team arrests six in prolific auto theft ring
- Michigan allocates $12 million to support community-based organizations in advancing environmental and climate justice
- Oakland County and SMART launch pilot program providing free transit for veterans and dependents
- Supreme Court sides with the Consumer Financial Protection Bureau
headlines National
- More lawyers—and clients—want to learn about sustainable development practices
- Top artificial intelligence insurance tips for lawyers
- Lawyer charged with illegally transmitting Michigan data after 2020 election
- Viral video shows former Rikers Island inmate as she learns she passed bar exam on first try
- How Sullivan & Cromwell is scrutinizing potential new hires after campus protests
- No separate hearing required when police seize cars loaned to drivers accused of drug crimes, SCOTUS rules