People inside what's left of MF Global are still clinging to the hope that the missing $600 million in customer funds can be found and is locked in collateral accounts at three institutions: JPMorgan(JPM), Bank of New York (BK) and the Depository Trust & Clearing Corp., the FOX Business Network has learned.
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Officials from these companies declined to publicly comment on the matter, though speaking on a not-for-attribution basis, they confirmed that they are holding hundreds of millions of dollars in collateral from MF Global. However, they doubted that collateral is related to hundreds of millions of dollars in customer money that went missing amid MF Global's stunning implosion and eventual bankruptcy.
That said, officials from the Commodity Futures Trading Commission, the lead investigator into the missing money, and people working for MF Global's bankruptcy trustee, won't rule out that a simple explanation of missing funds is at hand.
People inside MF Global, which suffered a liquidity crisis amid disclosures that the firm made massive bets on the sovereign debt issued by troubled European nations, believe that once the collateral is "netted out," where losses are subtracted from its base, the missing cash is likely to appear.
If that's the case, the firms and its top executives, such as former Chief Executive Officer John Corzine will face questions about their handling of customer accounts, which under law must be kept separate from the general operations of the firm. In addition to the CFTC, the FBI and the Justice Department are investigating the circumstances surrounding MF Global's demise.
A lawyer for Corzine didn't return a call for comment.
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Separately, attorneys working for MF Global are weighing whether to write Interactive Brokers CEO Thomas Peterffy about comments he recently made about the firm following its bankruptcy two weeks ago.
Interactive Brokers was close to a deal to buy a chunk of MF Global's business just before its bankruptcy filing and Peterffy has been quoted in news reports saying he backed off from the purchase after discovering the missing customer accounts, which "put the exchanges and regulators in a very tough position."
An attorney for MF Global would not comment, but people close to the firm say a possible "warning letter" to Peterffy might also be a precursor to a lawsuit on the grounds that Peterffy violated confidentiality clauses stemming from the failed deal.
A spokeswoman for Peterffy had no comment on the matter.