Wealth Manager - the site for professional investment managers

Register free for our breaking news email alerts with analysis and cutting edge commentary from our award winning team. Registration 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 Boutique tapes: my business will never be sold

Boutique tapes: my business will never be sold

In the final part of our four part series we discuss consolidation and whether it's getting tougher for boutiques to survive.

Play Boutique tapes: are top managers better off at small firms?

Boutique tapes: are top managers better off at small firms?

In episode three of our series, boutique bosses discuss whether the best fund managers are more likely to thrive at smaller firms.

Play Boutique tapes: if you want a Ferrari, you have to pay for it

Boutique tapes: if you want a Ferrari, you have to pay for it

In the second part of our four-part series, boutique bosses are asked how they can justify the fees charged by active managers.

Read More
Your Business: Cover Star Club

Profile: how this boutique beat the big guns of wealth

Profile: how this boutique beat the big guns of wealth

This small west country offshoot of a local IFA scooped a 2018 Citywire award from beneath the noses of the national challengers

Wealth Manager on Twitter