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Major Finance Co. MF Global Fires 1,066 Employees


Entire workforce.

NEW YORK (AP/The Blaze) -- Defunct trading company MF Global Inc. says it is terminating 1,066 members of its workforce.

The terminated employees will be paid through Nov. 15 and will have health coverage through the end of the month, but they will not get severance.

However, the MF Global trustee said the liquidation and terminations do not apply to the parent company, MF Global Holdings, which listed 2,847 employees as of September, reports Fox Business.

The company said Friday it is dismissing workers in accordance with a bankruptcy court-mandated liquidation. Between 150 and 200 former employees are being hired to assist with the liquidation and court proceedings.

Allegedly, they are also “exploring ways to immediately vacate” MF Global’s Manhattan offices so that they can rent the smaller and less expensive offices for the trustee staff.

The company will continue to rent its Chicago office, the trustee said to Fox, but for a “limited” amount of time as the business there is wound down.

The company said the firing of employees and closing of operations “is a necessary part of the court-ordered liquidation of MF Global and is consistent with the trustee’s obligations…to preserve assets."

MF Global's downfall has been attributed to, among several other things, very bad bets on some "$6.3 billion of European government debt," reports CNN Money.

When those bets didn't pay off—and their financial problems turned into a disaster—many believe that MF Global may have started using its clients money (though it is still unclear how the money may have been used).

It's important to note that using clients money to help ones bottom line with risky investments could be a violation of Commodities Futures Trading Commission rules on such trades, according to regulators and financial experts.

Not surprisingly, when MF Global was unable to account for a $593 million of MF customer funds, Federal investigators got involved.

The probe of MF Global's cash movements is being conducted by the U.S. Justice Department, the Commodity Futures Trading Commission, the Securities and Exchange Commission and the bankruptcy trustee's staff in cooperation with the Securities Investor Protection Corp., James W. Giddens, the trustee, said on his website.

In addition to the missing funds, many have also criticized ex-CEO John Corzine, the former governor of New Jersey, for abruptly resigning hours before conflicting reports surfaced about the whereabouts of the missing customer money.

The company said in a statement that all the employees were notified of their termination Friday.

Updates have been added since this story was originally posted. The Associated press contributed to this report.

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