Goldman, Underwriters Win Approval of MF Global Accord

Goldman Sachs Group Inc., JPMorgan Chase & Co. and other financial institutions won court approval of a settlement with MF Global Holdings Ltd. bondholders who blamed the banks for the bankrupt company’s losses after its brokerage unit failed.

The underwriters agreed to pay $74 million to resolve claims over misstatements and omissions in offering documents, according to a letter sent by lawyers from both sides to U.S. District Judge Victor Marrero in Manhattan, who on Jan. 5 dismissed claims against the settling companies.

MF Global filed the eighth-largest U.S. bankruptcy, with $41 billion in assets on Oct. 31, 2011, after making bets on European sovereign debt and getting margin calls. Other underwriters in the agreement include units of Deutsche Bank AG, Citigroup Inc. and Bank of America Corp.

Jeff Ross, a lawyer representing some of the funds, said in a phone interview that his clients settled separately and alongside a class of bondholders, without specifying the terms.

The case is In Re MF Global Holdings Limited Securities Litigation, 11-cv-07866, U.S. District Court, Southern District of New York (Manhattan). The Chapter 11 case is In re MF Global Holdings Ltd., 11-bk-15059, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

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