Investors who purchased MF Global Notes should consider securities arbitration against the underwriter broker-dealer from whom they purchased the Notes as a way of possibly recovering their losses.
Though it is unsure when and how much MF Global noteholders will receive from the firm’s bankruptcy, Fitch Ratings stated in early November that the amount received by owners of MF Global’s senior unsecured debt could be as low as 10 percent of their investment. Fitch Ratings estimates the maximum investors will receive at only 30 percent. Investors who purchased MF Global 1.875 percent Convertible Senior Notes due in 2016, MF Global 3.375 percent Convertible Senior Notes due in 2018 and Global 6.250 percent Senior Notes due in 2016 may have a valid claim against the underwriters of these Notes. Jefferies, Bank of America, Merrill Lynch, Lebenthal & Col, Sandler O’Neill + Panthers, BMO Capital Markets, US Bancorp, Commerzbank and Natixis are some of the underwriters of MF Global Notes.
It is possible that the underwriters of MF Global Notes knew or should have known more about MF Global’s financial problems and may not have adequately disclosed material information in the Notes’ prospectuses. Reports that the prospectuses may have been misleading have led to an investigation.
It is the obligation of the underwriters of a securities offering to put forth adequate due diligence concerning the issuer during the process. Underwriters must also ensure the accuracy of prospectuses and securities registration statements. Full and fair disclosure must also be provided to investors regarding material information concerning the issuing company and securities. Any omissions or misrepresentations regarding material information in a prospectus or registration statement subjects underwriters to potential liability under the Securities Act of 1933.
MF Global noteholders should consider the possibility of recovering their losses in securities arbitration and should not wait until the bankruptcy process is complete before contacting an investment attorney. To find out more about your legal rights and options, contact an investment attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.