The MF Global Grinch Who Stole Christmas
On Halloween morning 2011, executives for MF Global Inc. announced the ultimate trick or treat prank. Only now in this story the MF Global Grinch's plan to steal Christmas for many charities in the Chicago-area has worked.
Investigators search diligently for hundreds of millions of dollars of customer funds that the CME Group Inc. says were improperly removed from MF Global Inc.'s accounts in its final days in a failed effort to patch the hole in the dam of its reservoir of cash.
In November, CME Group said it would give former MF Global customers the entire $50 million held by CME Trust, which was suppose to help traders caught out by a broker default, but in recent years it became the flagship for CME Group's charitable giving.
CME spokesperson Laurie Bischel said, “CME Group will continue to honor some previous Trust commitments going forward, even after the $50 million is paid out. Though the CME Trust will be used to help customers of MF Global. CME Group remains committed to our communities and will continue to provide support to charitable organizations as possible through our other programs and corporate foundations.”
The CME Trust was started in 1969 to provide financial assistance to customers if a brokerage, such as MF Global, became insolvent.
On Halloween morning, the day MF Global filed for bankruptcy, the brokerage's executives disclosed their trick. The trick was on their customers as regulators discovered that money had been moved from customer accounts to the brokerage's accounts. Moreover, the money in the brokerage's accounts was missing.
In the middle of November, CME Group's board voted to turn CME Trust back to its original purpose. So now, this means less money for Chicago-area universities, charter schools, and institutions aimed at early childhood. According to the CME Group Foundation's website, all proposals for grants are put on hold.
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