The trustee liquidating MF Global told a US Senate Banking Committee today that investigators had found $1.6 billion in customer money missing since the futures brokerage collapsed last year.
Now they have the difficult task of trying to recover the funds, CNNMoney reported, citing the trustee, James Giddens.
Much of the money is held by MF Global’s subsidiary in the United Kingdom or was transferred to financial institutions with which company did business.
The announcement came on the same day that a US judge gave Giddens the green light to distribute as much as $685 million to customers whose accounts were frozen when the MF Global went bust last year, Reuters reported.
Giddens has already handed out more than $4 billion since the brokerage collapsed in October, Reuters said, citing the trustee’s spokesman Kent Jarrell.
Louis Freeh, a former director of the Federal Bureau of Investigation director who is now overseeing the holding company of MF Global, also told US lawmakers today that executives of the firm would not receive bonuses, according to the Financial Times.
MF Global filed for bankruptcy last October after making $6.3 billion worth of bad bets on European sovereign debt.
Soon after regulators discovered that $1.6 billion of customers’ money was missing.
In December MF Global’s former chief executive Jon Corzine told a House Agriculture Committee hearing in Washington that he didn’t know where the money had gone.
MF Global is the subject of various regulatory and congressional investigations.