ORIGINAL POST, SEE UPDATE BELOW: Bloomberg is reporting that missing money from MF Global’s customer accounts have been found in a custodial account at JP Morgan – approximately $658.8 million.
This is certainly an interesting turn of events. Earlier this week, an MF Global executive admitted to a federal official that they had used customers’ money.
The missing funds was originally discovered during the due diligence process over the weekend when Interactive Brokers was in discussions to buy the now-bankrupt firm, and the discovery promptly cut off the deal. DealBook first reported on the missing funds Monday.
At first, the amount missing was estimated to be at around a billion dollars, but the figure got narrowed down to between $600 million to $700 million.
The Commodity Futures Trading Commission, one of the regulators of MF Global, has been scrambling to find the funds ever since it was reported missing. Two days ago, CFTC sent subpoenas to PricewaterhouseCoopers, MF Global’s accountant, for data on brokerage’s clients’ accounts in a further escalation of the investigation.
Yesterday, CNBC reported that a source close to the company had said all of MF Global’s funds were there – but had gotten mixed up in a speedy liquidation process.
More details to come.
UPDATE: CNBC is now reporting that JPMorgan has denied that it has the missing MF Global funds. While MF Global does, apparently, have several hundred million dollars worth at JP Morgan, it is not in fact THE money that everyone is looking for. Apparently the $658.8 million held at JP Morgan was just similar to the $633 million figure that was being thrown around for how much money was missing. Wild.