Aaaaand the MF Global bankruptcy drama just got taken up a notch.
Federal regulators have discovered that hundreds of millions of dollars in customer money [has] gone missing from MF Global in recent days, prompting an investigation into the company’s operations as it filed for bankruptcy on Monday, according to several people briefed on the matter.
Evidently the missing money, perhaps up to $700 million, is what killed any chance of a deal for the company, and obviously the big fear is that somehow customer money got co-mingled with the firm’s money in some improper way as it attempted to stay alive.
What’s worrisome, right away, is that if customers fear their money might not be available, the confidence-jolt to the system could be much worse.
For more on MF Global, and how its bankruptcy decimated trading today, see here.
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