MF Global customers abroad may see their frozen funds at least partially returned in the near future, according to several reports this weekend. In the UK, clients subject to the asset freeze may submit claims in two weeks, while in Canada, a court has ordered MF Global’s trustee to begin making cash payments.
KPMG, the firm now responsible for MF Global’s UK branch, says that customers may submit claims beginning December 8. “This helps to create certainty around the number and size of claims with the intention of allowing a return of a proportion of client funds before March 30 2012,” explained Richard Heis, joint special administrator of MF Global UK. The amount clients can expect to recover will depend in turn on what KPMG receives from banks, exchanges, and other institutions. Approved claims will be paid within 14 days. This announcement comes on the heels of a US court order granting American trustees access to company funds. While MF Global’s American operations have been plagued by reports of missing millions (if not billions), these shortfalls are not expected to affect clients in the UK.
Similarly, in Canada, where KPMG is also administering MF Global’s local unit, a court has ordered the trustee to make cash payments to the 2,500 customers with MF Global forex accounts. KPMG says that the payments will be made within seven days, and that it has nearly completed the transfer of MF Global Canada assets to RBC Dominion Securities, a unit of the Royal Bank of Canada.
Meanwhile, in the US, Louis J. Freeh, a former FBI director, has been appointed Chapter 11 trustee for the broker-dealer’s bankruptcy proceedings. The decision was made after the firm and its creditors asked that one person take charge of asset recovery. Freeh will communicate with international regulators to facilitate the return of client funds. His appointment now must be approved by U.S. Bankruptcy Judge Martin Glenn, who is overseeing the case.