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An MF Global sign is seen in the office building in New York. (Mario Tama/Mario Tama/Getty Images)
An MF Global sign is seen in the office building in New York. (Mario Tama/Mario Tama/Getty Images)

Motion filed to transfer MF Global Canada customer accounts Add to ...

The bankruptcy trustee for brokerage house MF Global Canada Co. will seek court approval Monday to transfer a substantial number of customer accounts to RBC Dominion Securities Inc. – a move that would free up investor holdings that have been essentially frozen for nearly two weeks.

KPMG Inc. issued a news release Saturday saying it will go before the Ontario Superior Court of Justice Monday at 10:00 a.m. (ET) to present the motion. Assuming the court approves the plan, MF Global Canada customers' futures, equity and bond trading accounts would be moved to RBC, where those clients would be free to trade in them as usual.

“We have worked as quickly as possible over the last week to obtain as much information as possible with respect to customer accounts and the reconciliation of customer accounts. This has been a very complex process.” said Richard Harris, restructuring partner at KPMG, in the news release.

MF Global Canada customers have not been able to access their accounts, other than to conduct a limited number of liquidation trades, since Canada's industry regulator, the Invesment Industry Regulatory Organization of Canada (IIROC), suspended the company's trading privileges Nov. 1, in light of the Oct. 31 bankruptcy of the company's U.S. parent, MF Global Holdings Ltd.

On Nov. 4, the Canadian Investor Protection Fund (CIPF) obtained a bankruptcy order for MF Global Canada, allowing for a trustee to be appointed to locate customer assets and arrange for them to be transferred to another financial institution.

KPMG noted that the transfer to RBC Dominion Securities would not include foreign-exchange trading accounts.

“For these customers and any other customers ... the trustee is considering the available alternatives,” it said, adding only that it would provide further information for these accounts “as soon as possible.”

It's unknown how many accounts would be covered by the proposed transfer, or the value of the holdings in those accounts. In total, MF Global Canada customers are estimated to have about $400-million of net assets in accounts with the bankrupt firm.

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