Remaining Collateral
Companies in bankruptcy typically get loans to finance operations while they reorganize from a lender who wants to protect its prior investment, or a potential buyer. MF Global tried to sell itself in the days prior to its bankruptcy, but failed. JPMorgan has asked for all the company's remaining collateral.
"I would think that come Nov. 14, JPMorgan is going to decide if it has a better chance at maximizing value by keeping the company operating or trying to stop the company from using its cash collateral," Marinuzzi said.
MF Global's bankruptcy may face complications similar to those of Lehman Brothers Holdings Inc., where disputes arose over whether parties holding collateral for one transaction have a right to hold it because they have an unrelated claim against MF Global, Marinuzzi said.
"You could have collateral in the hands of third parties posted by MF Global which themselves may have claims against MF Global," he said.
Damage Claims
Customers who may have damage claims against the estate not covered by the Securities Investor Protection Corp., or SIPC, could also seek to get involved in litigation with the holding company, Peltz said.
"Who allowed MF Global to dip into my account -- in essence -- and steal my funds?," said Gary Mahoney, 64, of Las Vegas.
"Traders expect that the money they put up for margin call is always there, no matter what, thus the reason these funds are segregated," said Mahoney, who said he doesn't know what will become of the $3.5 million in cash collateral and about 200 positions he held in his MF Global account.
Customers are the most immediately affected by liquidation of MF Global's brokerage, as all their accounts will be transferred today with only 60 percent of their collateral, or liquidated. SIPC, which has taken over customer accounts, reimburses only up to $500,000 in losses to investors.