Broker-dealer MF Global went bankrupt in 2011, causing customers to lose millions of dollars. On Monday, a federal regulator reported that MF Global will pay $1.2 billion in restitution to its former customers. This payment will be an extension of the New York federal court order for the company to pay a $100 million civil penalty.
In June, the Commodity Futures Trading Commission issued a complaint that MF Global unlawfully used customer money, and the company eventually admitted to the accusations. MF Global invested $6 billion in bets on European government debt back in 2011, but when the strategy proved unsuccessful the company look $1.6 billion out of customers’ accounts.
Gretchen Lowe, head of CFTC enforcement, said that their staffers “worked tirelessly to ensure that 100% restitution be awarded to satisfy customer losses.”
