MF Global Trustee’s Advance of General Estate Assets to Make Customers Whole May Speed Distributions to Introducing Brokers

The MF Global trustee has received court approval to advance more than $600 million of general estate assets to customers to allow 100% distributions to all customers.  As a result, introducing brokers with general unsecured claims may sooner receive partial interim distributions.  It is unclear whether the advance will result in introducing brokers ultimately receiving lower recoveries. While a portion of the advanced assets represents relatively certain future recoveries of customer assets, a portion also does not.  Nonetheless, all future recoveries of future customer assets, including those from pending class action litigation, will be allocated to the general estate and…

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