Freeh is fighting for the entrenched and engorged banking status quo, where legitimizing the theft of hundreds of millions by Jamie Dimon is just another part of the job.
Giddens is doing great work. Freeh's statements that portray events as a feud that should be settled amicably are disingenuous and inaccurate. As Giddens points out they have different roles and objectives. Giddens is charged with reimbursing customers while Freeh's goal is to reimburse creditors (JPM) at the expense of MF customers. Freeh has a number of conflicts here as he fights to allow Jamie Dimon to hold on to stolen customer funds.
The fact that the law has been morphed and abused to make customers not first in line is a travesty of our bankruptcy and creditor system and only occurred because big banks (the creditors of MF Global) lobbied to have the rules changed in the first place.
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Corzine Complains to Bankruptcy Judge
NEW YORK, Aug 29 (Reuters) - Former MF Global Chief Executive Jon Corzine is fighting efforts by a bankruptcy trustee to join forces with customers suing him.
Corzine, along with other current and former MF executives, filed an objection in court on Wednesday arguing that their ability to defend themselves would be hurt if trustee James Giddens is allowed to assign his legal claims to plaintiffs in existing cases. The executives are defendants in multiple lawsuits accusing them of mismanaging the firm and playing a role in its October 2011 collapse.
If allowed to join the customer cases, Giddens would have the right to limit the information and documents available to the executives through discovery, as well as dictate which documents the executives would turn over to plaintiffs, lawyers for Corzine and the other executives wrote.
Commodity trader customers of the firm's broker-dealer unit are facing an estimated $1.6 billion shortfall in their accounts, which Giddens has said is due to the firm's misuse of customer money in a frantic attempt to keep it afloat.
Some of the customers have sued Corzine, Steenkamp, Bradley Abelow, General Counsel Laurie Ferber and others. Giddens, too, said he saw valid claims against the executives for negligence and breach of fiduciary duty, but earlier this month he said he would forgo bringing those claims himself in favor of assigning them to and cooperating with the class-action plaintiffs.
Under Giddens' plan, any proceeds from the litigation would be sent to the broker-dealer's estate and distributed by Giddens to customers. The plan also faces pushback from Louis Freeh, Giddens' counterpart trustee who is liquidating MF Global's parent entity. The two trustees, which represent the interests of different sets of creditors, have long battled over entitlement to various pots of money. Freeh is trying to pay back creditors of MF Global's parent, like lender JPMorgan Chase & Co.
From earlier today:
Update: James Koutoulas On State Prison For Corzine