CHICAGO, Nov. 3, 2011 (GLOBE NEWSWIRE) -- Attorney Andrew Stoltmann announces the launch of an investigation into MF Global and its senior executives for actions leading to the collapse of the firm. Stoltmann is also investigating the firms that underwrote and sold note offerings related to MF Global. Jefferies served as the sole book-running manager for the offering, with BofA Merrill Lynch, BMO Capital Markets, Lebenthal & Co., Commerzbank, Sandler O'Neill + Partners, Natixis and US Bancorp serving as co-managers of the offering. In addition, multiple other brokerage firms sold notes related to the firm.
According to Chicago securities attorney Andrew Stoltmann: "Our preliminary investigation, as well as published reports, indicate a lack of internal controls at MF Global may have been a root cause of the collapse of the firm. The day it filed for Chapter 11 protection MF Global disclosed a shortfall in customer accounts that may be about $700 million according to some published reports. CME Group Inc., which has the authority to audit those accounts, said it still isn't sure how much client money was missing."
Craig Donohue, CME Group's chief executive officer, noted in a recent New York Times article, MF Global violated requirements that it keep clients' collateral separate from its own accounts. "While we are unable to determine the precise scope of the firm's violation at this time, we are investigating the circumstances of the firm's failure," said Donohue in the same article.
According to Andrew Stoltmann: "Keeping client collateral separate is one of the most basic obligations brokerage firms have to customers. While it is still unclear how much of a shortfall there may be, if any, published reports indicate it might be large."
In addition, multiple brokerage firms were recommending MF Global related bonds and notes to investors. For example, firms were actively recommending MF Global 6.250% Senior Notes due in 2016 which were offered for sale in August of 2011. The firms recommending these and other MF Global related notes had an obligation to perform the necessary due diligence to determine the soundness of the investment and the firm. In some instances, this may not have been done. In other instances, clients who were recommended the notes may not have been told the true risks.
According to attorney Stoltmann: "We continue to investigate multiple claims on behalf of investors who lost money investing in MF Global and the firm's related bond offerings. In addition, thousands of investors have had their accounts frozen at MF Global. Many investors have been unable to trade their account during this time period. These frozen accounts have led to investment losses that may be recoverable against MF Global and its control persons through lawsuits or FINRA arbitration claims. We encourage clients who have sustained losses investing in the common stock or bonds of MF Global or who have had their portfolio frozen to contact our law firm to discuss legal remedies against the firm and the firms who sold its notes."
To learn more, please contact attorney Andrew Stoltmann at 312.332.4200 or visit www.InvestmentFraud.PRO