WASHINGTON (CN) – The Securities Investor Protection Corporation shut down MF Global on Monday and said it will liquidate it. MF Global, run for the past 18 months by former New Jersey Gov. Jon Corzine, a former head of Goldman Sachs, bet more than $6 billion on bonds of European countries still struggling with debt.
The SIPC and SEC issued this joint statement on the company Monday:
“For several days, the SEC, CFTC and other regulators had been closely monitoring developments affecting MF Global, Inc., a jointly registered futures commission merchant and broker-dealer, in anticipation of a transaction that would include the transfer of customer accounts to another firm. Early this morning, MF Global informed the regulators that the transaction had not been agreed to and reported possible deficiencies in customer futures segregated accounts held at the firm. The SEC and CFTC have determined that a SIPC-led bankruptcy proceeding would be the safest and most prudent course of action to protect customer accounts and assets. SIPC announced today that it is initiating the liquidation of MF Global under the Securities Investor Protection Act (SIPA).”