The U.S. Securities and Exchange Commission is conducting a broad review into the collapse of the futures brokerage MF Global Holdings Ltd., SEC Chairman Mary Schapiro said on Thursday.
"We will look at every aspect of how the firm conducted business," Ms. Schapiro told Reuters on the sidelines of a conference on financial fraud held by the Financial Industry Regulatory Authority.
The SEC and FINRA are among MF Global's regulators. MF Global filed for bankruptcy protection on Monday, after risky trades on European debt triggered its collapse. Regulators are attempting to account for a roughly $600-million shortfall in funds from customers' futures accounts.
Ms. Schapiro declined to discuss any potential action the SEC's enforcement division may take against MF Global, but said that SEC examiners have been on the ground there since last week and have worked on a "24-hours-a-day basis" to sort through the issues.
Sources familiar with the matter have told Reuters that customer funds related to securities accounts, which the SEC and FINRA regulate, appear to be accounted for and properly separated from the firm's money.
The Commodity Futures Trading Commission, which oversees the futures markets, is the regulator working to track down the hundreds of millions of dollars missing from customer's futures accounts.
However, Ms. Schapiro said she felt it was really too early to say if everything is in order on the securities side.
"It's extremely troubling the kinds of risks that were taken," she told Reuters. "We don't know yet what holes exist, whether they can or will be filled, and until we know that, we can't really do the post-mortem."
Still, she said, the regulatory actions that have followed since the collapse have occurred without hitches.
"I think in many ways the system, when there has been failure, is working the way it should at this point in terms of the regulators working together," she said.