MF GLOBAL INC. TRUSTEE -- UPDATE ON DISTRIBUTIONS
(The following is a reformatted version of a press release issued by the Trustee for the liquidation of MF Global Inc. and received via e-mail. The release was confirmed by the sender.)
UPDATE REGARDING DISTRIBUTIONS
Date: July 18, 2013
James W. Giddens, Trustee for the Securities Investor Protection Act liquidation of MF Global Inc., anticipates significantly increasing distributions to MFGI’s former Futures Commission Merchant (FCM) customers in the coming months, with the ultimate goal of reaching a 100 percent distribution to all customer account classes. These further distributions are dependent on final approval of a motion by the Trustee to confirm the allocation of property already received and to be recovered from third parties to the fund of customer property.
Immediate Interim Distribution Rate Increase
On July 18 the Office of the Trustee initiated further distributions to customers trading on foreign exchanges (30.7 Customers) increasing the distribution rate to 26% of those customers’ allowed claims. Customers who have returned valid releases should receive checks from the Trustee’s office in the next few weeks.
Future Interim Distribution Rate Increase
Assuming that settlement agreements with J.P. Morgan Chase and MF Global UK (MFGUK) become effective in mid-August, and further assuming the receipt of cash from both of those parties by the end of August, additional distributions to all customers should be able to start in early September. The exact percentages to be distributed to customers trading on U.S. exchanges and foreign exchanges are dependent on how much property is ultimately received from MFGUK. It is likely that, as part of this potential future distribution, customers trading on U.S. exchanges (4d Customers) will receive distributions bringing them to a percentage recovery in the high nineties and that 30.7 Customers will receive distributions bringing them to a percentage recovery in the sixties.
Final Distribution to 100%
Upon approval of the consent order with the U.S. Commodity Futures Trading Commission (CFTC), Mr. Giddens further expects to file a motion seeking Bankruptcy Court approval to allocate additional funds towards the fund of customer property, which would allow a final distribution of 100 percent to all former MF Global Inc. commodities futures customers, including both 4d and 30.7 Customers. Those final, complete distributions can only be initiated after Mr. Giddens’ motion has been approved by a final, non-appealable order and after the receipt of funds from MFGUK referenced in the preceding paragraph. Depending on whether there are objections or appeals, this distribution is likely to occur sometime in the fall. Mr. Giddens’ goal throughout the liquidation proceeding has been to reach a 100 percent return of assets to the former customers of MF Global Inc. These final steps in the process are the result of the effectiveness of settlement agreements and cooperation with MFGUK, MF Global Holdings Ltd., and J.P. Morgan Chase and their professionals as well as advice and guidance from the CFTC and the Securities Investor Protection Corporation and the consequent return of assets to the MF Global Inc. estate and release of required reserves.