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"Collapse" of MF Global? - Printable Version

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"Collapse" of MF Global? - B4Time - 12-16-2011 03:04 AM

Quote:"Collapse" of MF Global? - CAFR1 Reply
by Walter Burien - CAFR1.com
12/13/11


To all readers of this article, see if you can make the comments below go Global. All of the people that read the following comments will find them very insightful and it may just put a little pressure on the FBI to do their job.

Corzine MFGCorzine is a thief. He lost by trading activity the house's (MF GLOBAL) money to the tune of a billion dollars and then dipped into the client's money for 700 million dollars (almost a 2-billion dollar loss). It is the #1 criminal infraction that can be committed in the commodity futures market by using client's funds for a house posistion and with something of this magnitude the CFTC would have gotten an arrest and seizure order against Corzine from day-one when discovered if it was for other than the politically connected Corzine.

Here is the BIG point that needs to be immediately passed on to the public. In a situation like this the "loss" to MFG is just one side of the coin. The other side of the coin is who made the profit that counter balances with the loss.

If Corzine had this set up as an intentional sting operation, in advance a shell trading company is established and for example purposes we will call it Hong Kong Trading Partners LTD. (HKTP) held in Singapore. The sting goes like this:

As Corzine through MFG takes a derivative futures market position HKTP takes the exact corresponding opposite position tit for tat to what MFG is entering into. The market goes against MFG creating a loss but now the equal profit is growing in HKTP.

MFG increases their position and HKTP likewise does the same and the market again goes "against" MFG and "for" HKTP.

Now for the play-out of the sting. It is announced MFG has taken this large position with their own funds and also did the primary no-no of using client's funds to back it.

Well, procedure is clear in this type of situation: "Forced liquidation of all positions held by MFG"

What this does is give HKTP the liquidity to get out of their position from MFG's forced liquidation without causing an adverse movement to HKTP's position when being liquidated. MFG's forced liquidation is HKTP's volume needed to get out of their position and lock in their profit. Wealth transfer complete; MFG and a few of their clients decimated, and none outside of the sting are the wiser if no one carefully looks at who was playing the other side of the position against MFG.

If Corzine and a few of his buddies set up a sting as noted above, as far as they are concerned, they did not loose 1. something billion dollars for MFG and MFG's clients, what they did was they transferred 1. something billion dollars to themselves through a shell global trading company(s).

In most cases when a sting like this plays out it is not just one shell company used to play the other side of the coin, usually it is spreed out between ten or more shell trading companies.

A government and media cover up would just focus on MFG's loss. A true and open investigation would be focused on "who" took the other side of the coin; the profit.



http://cafr1.com/MFG.html


RE: "Collapse" of MF Global? - FastTadpole - 12-16-2011 11:35 AM

Man Group plc was split off into MF Global in 2007. Basically Man Group, based in Britain cut off a bad appendage so it didn't have to be responsible for future losses. Plus it was used as an arms' length tool to was leveraged with Derivatives into EU and provide some market manipulation with obviously bad investments into PIGS financial institutions. They essentially served as a dumping ground for bad positions to offload bad market positions on.

Quote:Global IPO
19 Jul 2007

Man Group plc today announces that the initial public offering of 97.4 million shares of MF Global Ltd. has been priced at $30 per share raising total gross proceeds of $2.9 billion. MF Global is the brokerage business of Man Group and was formerly known as Man Financial. MF Global's common shares are expected to begin trading today on the New York Stock Exchange under the ticker symbol "MF".

The 97.4 million shares represent approximately 80% of the outstanding share capital of MF Global. Man Group has granted the underwriters an option to purchase up to 9.7 million additional common shares of MF Global in the offering.

As previously stated, subject to shareholder approval, the net proceeds of the IPO will be distributed to shareholders in the fourth quarter of the calendar year.

Simultaneously with the IPO of MF Global becoming effective, Kevin Davis, CEO of MF Global, has stepped down from the Board of Man Group plc with effect from today.

Peter Clarke, Group Chief Executive of Man Group plc said:

"The successful IPO of MF Global completes our strategy to focus on the Group's leading position in alternative investment management. We believe that this focus, combined with our strengths across investment management, product structuring and distribution will deliver attractive and innovative products for our investors and continued strong returns for our shareholders."
http://www.mangroupplc.com/media/news-from-man/2007/press-release-19jul2007.jsf

Quote:Man Group disposes of its remaining shareholding in MF Global
14 Aug 2009

Man Group plc today announces that its wholly-owned subsidiary, Man Group UK Ltd, has entered into a Variable Forward Sale (“VFS”) Agreement with Nomura International plc (“Nomura”) over its entire remaining stake in MF Global Ltd. (“MF Global”).

The transaction is the final step in Man Group’s complete disposal of MF Global shares following its IPO in July 2007. From an accounting perspective, de-recognition of the MF Global shareholding occurs immediately. Nomura has executed its initial hedging sales under the VFS Agreement at a sale price of $5.95 per share. The VFS Agreement guarantees that Man Group will achieve a minimum of $5.355 per share (90% of the Nomura’s initial hedging sales price), while retaining a capped participation in future share price appreciation over a three to four year period. The structure provides Man Group with gross initial disposal proceeds of $112 million, which it expects to receive early next week.

Man Group’s regulatory capital surplus will increase by roughly $90 million as a result of this transaction.

MF Global will receive no proceeds from the VFS transaction.

Nomura’s hedging sales of the common shares under the VFS Agreement are being made pursuant to an effective registration statement on Form S-3 that was previously filed by MF Global with the U.S. Securities and Exchange Commission. Nomura’s initial hedging sales have been made to a limited number of Investors. This press release does not constitute an offer to sell or the solicitation of an offer to buy any of MF Global's common shares, nor shall there be any sale of MF Global’s common shares in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Copies of the prospectus supplement relating to this transaction, when available, may be obtained by contacting: Nomura Securities International, Inc. on +1 212 667 9434.
http://www.mangroupplc.com/media/news-from-man/2009/press-release-14aug2009.jsf

Nomura is a global holdings company based in Japan. Probably to insulate Man Group from any lawsuits and play the shell game. From the IPO to the sale to Nomura stock prices went from $30.00 to ~$5.30 per share.

Interesting that MF Global served in a financial advisory role for the now defunct Chicago Climate Exchange, formerly North America's only Carbon Trading Market.

Quote:JPMorgan disclosed the funds to MF Global in a statement dated October 31, 2011, the person said. The statement revealed a total of $2.2bn – including MF Global’s own funds – held at JPMorgan, which also was listed as the largest unsecured creditor to its holding company.

Regulators and bankruptcy lawyers are widening their investigation into MF Global’s collapse. On Friday, the bankruptcy trustee won approval to subpoena records from the company and share them with authorities. “In this case, there have already been serious allegations of potential misconduct,” Martin Glenn, US bankruptcy judge, said.
http://www.ft.com/cms/s/0/1b59c1bc-06e2-11e1-90de-00144feabdc0.html

Quote:Both the Commodity Futures Trading Commission and the Chicago Mercantile Exchange were charged with overseeing MF Global, their clearing member. If we are to believe them, they had no idea of any difficulties within the firm before customer accounts went missing just a few days before the collapse. But someone clearly knew of the cratering positions and imminent collapse of MF Global, as billions of dollars of accounts were “coincidentally” withdrawn..
http://www.huffingtonpost.com/daniel-dicker/the-koch-brothers-and-mf-_b_1089906.html

Quote:Examiners from CME Group Inc., the world’s largest futures exchange, found unexplained wire transfers at MF Global Inc. and a $900 million shortfall in client funds during the weekend the failing broker was talking with possible buyers, a person briefed on the matter said.

CME noticed the missing funds on October 30, but MF Global didn’t inform the Commodity Futures Trading Commission until the day after, suggesting that the transfers were made, “in a manner that may have been designed to avoid detection..
http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/11/16/bloomberg_articlesLUQ7FP0YHQ0X.DTL

Why Gerald Celente invested with them, knowing what he knows, is beyond me. He did say he does have most of his funds and assets stored in a "safe place" though.

Related:

Claim: Clinton Collected $50K Per Month From MF Global
Quote:“The traders would be shaking their heads,” he said. “They would come back to their desk and say, ‘Well, I thought we were going to do this—but Corzine would come by and do something else all by himself,’” he said.
http://concen.org/forum/showthread.php?tid=43707