Chilton Says Brokers Should Put Client Funds Only in U.S. Debt

The U.S. Commodity Futures Trading Commission should ban derivatives brokers from investing client funds in anything other than U.S. debt, commissioner Bart Chilton said.

Chilton said recent changes in regulations governing client funds, approved after MF Global Holdings Ltd. filed for bankruptcy, don’t provide enough protection for clients.

Steps need to be taken to put “confidence and trust back into our U.S. derivatives markets,” Chilton, a Democrat, said in a statement.

MF Global filed for bankruptcy on Oct. 31. James W. Giddens, the trustee overseeing the liquidation, has estimated that as much as $1.2 billion in client funds may be missing.

Editors: Lawrence Roberts, Maura Reynolds

To contact the reporter on this story: Silla Brush in Washington at sbrush@bloomberg.net

To contact the editor responsible for this story: Lawrence Roberts at lroberts13@bloomberg.net

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