public company traded as otc pink mfglq industry financial services fate filed for chapter 11 bankruptcy . the brokerage unit is undergoing sipc liquidation . founded 2007 2007 founder man group defunct 2011 2011 headquarters new york city united states key people jon corzine ceo mar 2010 november 2011 services financial broker online trading futures options cfds spread betting operating income 100 000 000 total assets 42.460 billion 2010 total equity 1.490 billion 2010 number of employees 3 271 1 website www.mfglobal.com mf global formerly known as man financial was a major global financial derivatives broker or commodities brokerage firm that went bankrupt in 2011 . mf global provided exchange traded derivatives such as futures and options as well as over the counter products such as contracts for difference cfds foreign exchange and spread betting . mf global inc. its broker dealer subsidiary was a primary dealer in united states treasury securities . a series of perceived liquidity problems and large fines and penalties dogged mf global starting in 2008 and led to its bankruptcy in 2011 . in 2011 mf global faced major pressures to its liquidity over several months . some analysts and financial commentators indicate that mf global probably experienced a number of trading days in 2011 during which the firm s bets on sovereign debt would have required the use of customer funds to meet capital requirements thereby maintaining operating funds and possibly overall solvency . a large part of these pressures on mf global were a result of the firm s involvement in a significant number of repurchase agreements . many of these repo agreements were conducted off their balance sheet . also mf global made a 6.3 billion investment on its own behalf in bonds of some of europe s most indebted nations . failure of those and other repo positions contributed to the massive liquidity crisis at the firm . mf global experienced a meltdown of its financial condition caused by improper transfers of over 891 million from customer accounts to a mf broker dealer account to cover losses created by trading losses . on october 31 2011 mf global executives admitted that transfer of 700 million from customer accounts to the broker dealer and a loan of 175 million in customer funds to mf global s u.k. subsidiary to cover or mask liquidity shortfalls at the company occurred on october 28 2011 . mf could not repay these monies with its own funds . improper co mingling or mixing of company and client funds took place for days before the illicit transfer and loans and perhaps for many other days earlier in the year . according to the new york times mf global dipped again and again into customer funds to meet the demands perhaps beginning as early as august 2011 . 2 mf global declared bankruptcy on october 31 2011 and the company was liquidated beginning in november 2011 . 3 the trustee liquidating the company said that the losses incurred by customers of mf global stood at 1.6 billion at april 2012 . 4 5 in january 2013 a judge approved a settlement that would return 93 percent of customers investments with the prospect of additional payouts from the company s general estate . 6 7 in december 2014 mf global holdings settled a u.s. government lawsuit agreeing to pay 1.2 billion in restitution and a 100 million fine for customer losses tied to the company s 2011 collapse . 8 contents 1 history 1.1 origins 1.2 the 1900s growth diversification 1.3 the 1980s early 2000s acquisitions expansion and brokerage unit growth 1.4 2002 2007 acquisitions of a trading platform client assets 1.5 2007 spin off and going public 1.6 2008 2009 major fines liquidity concerns and stock price decline 1.7 march 2010 jon corzine named ceo 2 the looming crisis bankruptcy and collapse 2.1 october 2011 mf global transfers client account funds to its own account 2.1.1 re purchase agreements used extensively by brokerage 2.2 bankruptcy protection sought 2.2.1 bankruptcy filing the fallout and possible causes 2.2.2 creditors claims in the billions 2.2.3 board of directors ; criticism of corzine board 2.2.4 naming of bankruptcy trustees controversy 2.2.5 auditor subpoenaed for clients assets information 2.2.6 employees fired without severance pay 2.2.7 sec reviewed debt sales for insider trading fraud 2.2.8 bankruptcy trustee regulators investigate missing client funds 3 corzine s possible role in the firm s collapse 3.1 corzine s testimony before congress 3.2 april 2012 possible criminal civil actions against executives employees 4 references 5 further reading 6 external links history edit origins edit mf global traces its roots to the sugar trading business started by james man in england in 1783 which evolved into broader commodities trading before its later transformation into a financial services business during the 1980s focused on commodity futures trading . 9 the 1900s growth diversification edit mf global s former parent then known as ed & f man diversified from pure cash commodities into commodity futures in the late 1970s and established the anderson man futures brokerage in 1981 . it later changed its name to ed & f man international and then man financial . ed & f man operated as a partnership through to the 1970s when it started an international expansion which by 1983 increased its staff 650 employees . ed & f man listed on the london stock exchange in 1994 changing its name to man group in 2000 . its agricultural business which retained the ed & f man name was sold to management the same year . the 1980s early 2000s acquisitions expansion and brokerage unit growth edit the rapid expansion of the man investments unit in the emerging hedge fund management business shrouded many investors from the development of its brokerage unit . man financial embarked on a series of acquisitions which expanded its product capability and geographic reach starting in 1989 with the purchase of the chicago based gnp commodities and including well known industry names such as geldermann tullett & tokyo futures first american discount corp. australia s ord minnett and gni . 2002 2007 acquisitions of a trading platform client assets edit the 2002 purchase of gni was the largest of these and gave man financial access to the then growing contract for difference market and gni s trading platform gni touch . however in 2005 man financial made its largest deal with the transformative 323 million acquisition of client assets and accounts from entities of refco following the u.s. financial services group s collapse in late 2005 . the refco deal followed a hotly contested auction with cerberus capital the private equity group and boosted man financial s scale in retail and institutional business . 10 2007 spin off and going public edit mf global was the brokerage segment of man group until 2007 when the man group decided to split the investment and brokerage businesses so they could each focus on their own markets . man financial was spun off from man group as part of the initial public offering ipo and separation of the brokerage from the asset management operation . the brokerage business made the final identity change to mf global simultaneously with that ipo which occurred in june 2007 . the then separate investment business retained the name of man group . 11 the company was registered in bermuda but subsequently moved its registration and headquarters to the united states . 12 2008 2009 major fines liquidity concerns and stock price decline edit on february 28 2008 mf global announced a bad debt provision 13 in the amount of 141.5 million . the provision was the result of unauthorized trading by a representative in a mf global branch office who on february 27 2008 while trading in the wheat futures market in his personal account substantially exceeded his authorized trading limit . mf global held a conference call 14 at 11 a.m. est on february 28 to discuss the matter . mf global was fined 10 000 000 by the cftc over the incident and an unrelated natural gas incident from 2003 . 15 16 the cme group also fined mf global 495 000 over the wheat incident . 17 on march 17 2008 shares of mf global plummeted on liquidity fears . 18 the cme 19 ice 20 nymex 21 and cftc 22 issued statements confirming mf global was in compliance with regulatory and financial requirements . march 2010 jon corzine named ceo edit jon corzine former ceo of goldman sachs governor of new jersey and united states senator began his tenure as ceo of mf global in march 2010 . corzine spent nearly all of the 9 years prior to joining mf holdings as either u.s. senator or governor . from 1994 1999 corzine held the role of chief executive officer for goldman sachs . the looming crisis bankruptcy and collapse edit october 2011 mf global transfers client account funds to its own account edit on sunday october 30 2011 a unit of the new york based brokerage first reported to the chicago mercantile exchange cme and the commodity futures trading commission cftc a material shortfall of hundreds of millions of dollars in segregated customer funds . customer accounts were frozen the same day . on october 31 2011 mf global reported the shortfall in customer accounts at 891 465 650 as of close of business on friday october 28 2011 . 23 24 according to the trustee overseeing liquidation the shortfall may be as large as 1.6 billion . 25 26 27 mf global mixed customer funds and used them for its own account for at least several days before the bankruptcy and transferred funds outside the country . 28 the liquidation trustee ultimately reported that on october 26 2011 edith o brien an assistant treasurer in chicago who reported to the firm s treasurer in new york approved transfers totaling 615 million from segregated customer trust accounts at jpmorgan chase supposedly for an intraday loan . the funds weren t returned by the end of the day causing panic in ms. o brien s operation . ms. o brien continued to approve such loans in the ensuing days . on the morning of october 28 two company officials noted a deficit in segregated customer accounts of about 300 million . two members of o brien s staff improperly determined that a 540 million wire transfer into the segregated accounts the previous day had somehow gone unrecorded and double counted the transfer . the firm reported a surplus of more than 200 million to the commodities commission . the segregation report was revised to show a surplus without any backup documentation . that same day the 28th ceo jon corzine ordered o brien to transfer 175 million to jpmorgan to cover a firm overdraft . with no other source for the cash o brien approved a transfer of 200 million from a customer trust account at jpmorgan . the trustee s report concludes there was a substantial shortfall in customer segregated funds every day from oct. 26 when 615 million in loans from customer accounts were not repaid until mf global filed for bankruptcy on oct. 31 . 29 the cme reports that early on monday october 31 2011 officials of mf global admitted transfer of 700 million from customer accounts to the broker dealer and a loan of 175 million in customer funds to mf global s u.k. subsidiary to cover or mask liquidity shortfalls at the company . re purchase agreements used extensively by brokerage edit the brokerage used a large number of complex and controversial repurchase agreements or repos for funding and for leveraging profit many off their balance sheet . 30 31 some of these complex repos have been described as a wrong way 6.3 billion bet mf global made on its own behalf on bonds of some of europe s most indebted nations . failure of the repo positions