"Contrary to vague and self-serving assertions that MF Global’s affairs in its last week were so chaotic that no one really knew what was happening, some people at the firm obviously knew only too well, and took desperate measures that ignored clients’ interests. In doing so, they violated the most basic obligation of any brokerage firm, which is to protect customers’ assets.

More broadly, the report makes clear that the notion that customer assets are safely segregated, at least at commodities brokers, is an illusion thanks to a lax calculation of customer assets allowed by the Commodity Futures Trading Commission, which regulates commodities brokers.

Mr. Giddens cautioned that his report was by no means complete, and that he wasn’t in a position to draw conclusions about potential civil and criminal liability. But it seems clear that serious violations of law were committed, and the report will surely add to pressure on the Securities and Exchange Commission, the commodities commission and the Justice Department — the agencies investigating MF Global for potential enforcement and criminal proceedings."

http://www.nytimes.com/2012/06/09/business/trustee-suggests-mf-global-misused-customers-money.html?partner=rss&emc=rss