Fri, Sep 22, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Opalesque Futures Intelligence

The Untold Story: CME Group Independent Investigation Halted
Why was an investigation into MF Global halted by the CFTC just as promising results towards uncovering truth were announced?

Wednesday, November 14, 2012

CME Group Independent Investigation Halted

By Mark Melin

CFTC Commissioner Bart Chilton wrote in the book Ponzimonium that confusion is a trademark of the fraudster. The narrative surrounding MF Global has always centered around "chaos" and "complexity." However, one investigation knew exactly where to find truth.

Because it had front line authority over MF Global, the CMEGroup's investigation was highly anticipated by industry observers as providing clear indications as to criminal behavior. Leading up to Congressional testimony of December 13, 2011, the CMEGroup investigation was said to be gaining steam, close to clearly documenting criminal activity. In Congressional testimony CMEGroup Chairman Terry Duffy noted progress, pointing specifically to knowledge by senior MF Global executives of potential criminality in the illegal funds transfers.

The following day, the CFTC is said to have halted the CMEGroup's investigation. According to Washington D.C. sources, financial investigations conducted by the Department of Justice (DOJ) rely on financial regulators such as the SEC or CFTC relative to potential criminal charges. DOJ would typically not act without such a recommendation. It is this recommendation the DOJ currently awaits to receive from the CFTC, according to sources.

A halt in this investigation has not been explained, but following the abrupt halt the CMEGroup then became subject of an investigation.

As several books document, fraud is often accompanied by attempts to confuse or distract those from discovering the clear facts in the case.

As the MF Global investigation was underway, a curious component of the case included the fact that sources claiming to be related to the investigation had continually leaked information to the New York Times, Wall Street Journal and Reuters claiming the investigation was ending without criminal indictments. Such press statements from officials close to the investigation was highly unusual, particularly as some of the claims "the case was cold" occurred even before questioning of some the leading suspects, MF Global executive officers, took place.

Sources in Washington D. C. speculate such leaks likely had a source from officials at the CFTC, as the Department of Justice is still waiting for a recommendation from the agency. Thus, even if a source at DOJ were to have leaked information it may have been based on what it was told from the CFTC.



 
This article was published in Opalesque Futures Intelligence.
Opalesque Futures Intelligence
Opalesque Futures Intelligence
Opalesque Futures Intelligence
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Asia - Hedge funds used to love shorting China. Now, not so much, Fledgling China FoFs require careful use: NCSSF, Amac, Japanese banks turn to PE, hedge funds for returns[more]

    Hedge funds used to love shorting China. Now, not so much From Bloomberg.com: A sharp devaluation. A credit crisis. And an economic hard landing. That's what some of the biggest names in the hedge fund industry were predicting for China after the nation's stocks and currency tumbled in 2

  2. Launches - Orchard launches new credit platform, ETN based on hedge fund to launch on the LSE[more]

    Orchard launches new credit platform Orchard Platform has rolled out Deals as a part of its new platform launch. With the addition of Deals to their suite of technology solutions for loan originators and institutional investors, Orchard Platform takes the next step in their evolution. De

  3. Neuberger Berman closes $1.1bn Credit Opportunities Fund[more]

    Neuberger Berman, a private, independent, employee-owned investment manager, announced that NB Private Equity Credit Opportunities Fund LP closed on $1.1 billion of limited partner commitments. The Fund seeks to invest in the secured and unsecured debt of private equity-backed companies, primarily i

  4. Capital Dynamics launches mid-market private credit business[more]

    Capital Dynamics, a global private asset manager, has launched a dedicated Private Credit Asset Management business. Experienced industry executives Jens Ernberg and Thomas Hall have joined Capital Dynamics to co-lead the company's new private credit initiative. They are based in Capital Dynamics' N

  5. iCapital Network enters deal to acquire innovative U.S. private equity access fund platform from Deutsche Bank[more]

    Komfie Manalo, Opalesque Asia: Financial technology platform iCapital Network has entered into a definitive purchase agreement to acquire the US Private Equi