MF Global trustee Freeh to testify at Senate hearing

Wed Apr 18, 2012 1:13am EDT
 
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By Nick Brown

(Reuters) - Former customers of MF Global MFGLQ.PK, waiting for the return of as much as $1.6 billion missing from their accounts, will get their first chance next week to hear testimony from Louis Freeh, the embattled trustee for the bankrupt commodities firm.

Freeh, who has come under fire for the way he has managed the assets of MF Global's bankrupt parent company, will testify on April 24 before the Senate Banking Committee, according to an announcement from the committee on Tuesday.

Freeh, a former FBI director, will join James Giddens, the trustee in charge of MF's broker-dealer unit, and a handful of regulators as witnesses.

The hearing will address policy implications of MF Global's now-infamous implosion, which saw the Jon Corzine-led brokerage enter bankruptcy with a significant shortfall in the accounts of its commodity trader customers.

Unlike Giddens, who testified before the Senate Agriculture Committee in December, the hearing will be the first appearance before a Congressional panel for Freeh, the man tasked with recouping money for MF Global's creditors.

Customers and lawmakers alike have criticized Freeh at times, most notably amid reports he would consider seeking court permission to pay bonuses to some MF Global executives.

Critics felt it was improper to reward executives who may have helped orchestrate MF Global's downfall. Freeh has yet to take any steps with respect to seeking bonuses.

His spokeswoman did not have an immediate comment on Tuesday.   Continued...

 
The sign marking the MF Global Holdings Ltd. offices at 52nd Street in midtown Manhattan is seen in New York November 2, 2011. REUTERS/Shannon Stapleton