Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

MF Global clients lose out on $27m court ruling

MF Global clients lose out on $27m court ruling

A court ruling on the way client money calculations are worked out could see investors caught up in MF Global's collapse lose $27.9 million.

In a judgement handed down int he High Court, Mr Justice David Richards confirmed Financial Services Authority rules around the distribution of client money on a regulated firm's insolvency requite administrators to value open positions as at the date of administration, rather the date the open position is closed.

The court heard arguments from Schneider Trading Associates on behalf of clients of MF Global UK, who stood to gain an estimated $27.9 million if trades they put on and were open when the firm entered administration were valued at the date they were closed out.

But while Justice Richards acknowledged there was 'no perfect system', he said the regulator had used the same method applied to daily reconciliations of client money, for reasons that were 'understandable' and in the interests of consistency and speed.

Justice Richards ruled: 'While some claimants will, inevitably, lose out, the benefits of this decision overall in terms of the certainty and simplicity it offers administrators and liquidators are significant.'

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Potential US rate rise, cheap oil & the Europe opportunity

Potential US rate rise, cheap oil & the Europe opportunity

This week we analyse the implications of a possible rise in US interest rates, the impact of cheap oil and the European equity opportunity.  

Play Carmignac's Crowl: what QE could mean for Europe

Carmignac's Crowl: what QE could mean for Europe

The ECB is widely expected to finally fire its QE gun this week. Carmignac's Sandra Crowl discusses the implications for the eurozone.

Play Grexit worries, currency wars and a grizzly outlook for 2015?

Grexit worries, currency wars and a grizzly outlook for 2015?

The first Investment Pulse of the year looks at the potential impact of Greece leaving the euro, volatility in currency markets and the UK’s economic prospects.

Your Business: Cover Star Club

Profile: DIY investing is biggest threat to industry, says Whitechurch

Profile: DIY investing is biggest threat to industry, says Whitechurch

The industry is at risk of pushing potential investors down the DIY route unless it does more to make its services accessible says the Whitechurch Securities boss

Wealth Manager on Twitter