A commercial bankruptcy has different financial implications than a personal bankruptcy, although a business owner may support business debts with personal assets. Business owners often declare a business bankruptcy with a Chapter 11 filing. Readers in Long Island may want to learn about one brokerage firm that may be able to return investments to its clients after filing in this way. This could also help area customers who have been waiting to get their money back and may have to consider filing for personal bankruptcy as a result.
The bankruptcy trustee of MF Global reported recently that the defunct trading firm’s former customers may receive all of their investment funds back. MF Global collapsed in October 2011 after investing in European debt, and its clients have been unable to get their money back.
The trustee based his prediction on a comparison of the pending claims in the bankruptcy and MF Global’s assets that can be recovered. There are approximately $6.9 billion claims from customers, while the recoverable assets are estimated to be between $6.85 billion and $6.98 billion.
Federal regulators also say they will determine if MF Global took money from investor accounts when its financial condition became worse. Such an action would be illegal, and customers may have grounds to sue to get their money back.
Commercial bankruptcies where a large degree of assets are at risk threaten customers as well as employees. People who lost a large degree of money in MF Global’s collapse may need to declare bankruptcy in order to get their own finances in order.
Source: Associated Press, “MF Global Trustee Says Clients May Be Made Whole,” Feb. 4, 2013