The latest news on the MF Global bankruptcy and fallout, published in the John Lothian Newsletter (subscribe here) the morning of November 25, 2011.

In the wake of the MF Global bankruptcy, John Lothian Newsletter has created a special section on devoted to news, information and commentary. The section features archived news stories featured in the John Lothian Newsletter, analysis and breaking news. Check regularly for updates. See the MF Global news section here.

Futures Industry Reconsiders Customer Bailout After MF Global Disaster
Ann Saphir – Reuters
CHICAGO (Reuters) – In November 1986, shaken by traders’ losses after a brokerage went bust, the U.S. futures industry considered, and then rejected, the notion of insuring customer funds in a broker default. The collapse last month of MF Global Holdings Inc, and hundreds of millions of dollars of still-missing customer money, is forcing a rethink of that 25-year-old decision.

CME’s handling on MF Global draws trustee’s review
David Roeder | Chicago Sun-Times
The trustee searching for missing customer money in the bankruptcy of MF Global will investigate how well the Chicago futures markets monitored the brokerage before its collapse, a spokesman said Wednesday.Kent Jarrell, a spokesman for Trustee James Giddens, said the quality of a late October audit of MF Global by CME Group Inc. will be part of a broader inquiry. CME owns the Chicago Mercantile …

MF Global Brokerage’s Wind-Down Fees May Hit $100 Million a Year
By Linda Sandler – Bloomberg
Nov. 24 (Bloomberg) — Fees for liquidating the MF Global Inc. broker-dealer may reach $100 million in a year, based on lawyers’ estimates and costs to wind down two other brokerages, Lehman Brothers Inc. and Bernard Madoff’s firm.

MF’s Missing Money Makes You Wonder About Goldman: Jonathan Weil
Six months ago the accounting firm PricewaterhouseCoopers LLP said MF Global Holdings Ltd. and its units “maintained, in all material respects, effective internal control over financial reporting as of March 31, 2011.” A lot of people who relied on that opinion lost a ton of money.

FINRA CEO Ketchum’s Dear Jon (Corzine) Moment
I recently broke the story about the Financial Industry Regulatory Authority’s (“FINRA’s”) grant of two examination waivers to Jon Corzine, who is now at the center of a regulatory storm concerning his former firm MF Global Inc.”Did Someone At FINRA Do Corzine A Favor And Waive His Registration Requirements?” (“Street Sweeper” November 4, 2011). Registered Per Waiver Some press coverage of my …

Heed the ‘transparent’ lessons from MF Global
By Gillian Tett – Financial Times
What exactly sparked the dramatic demise of MF Global? That question has sparked feverish speculation, with the words “hubris”, “funding crisis”, “poor risk controls” or “bad sovereign debt bets” being tossed around.

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