broker-dealer subsidiary mf global inc. in the last two or three business days prior to the bankruptcy filing. this is in part because of my global role and partly in part because during those days i was taken up with other very serious matters. as global cfo i had many functions. principal among them was the effort to insure the holding company's consolidated financial accounts, complied with all u.s. accounting and reporting requirements and work closely with investors and the rating agencies. as its name suggests mf global holdings ltd. my employer is a global holding company with approximately 50 domestic and foreign subsidiaries. each of these regulators subsidiaries generally had its own or regional chief executive officer, chief operating officer, chief financial officer and others obligated to independently discharge the customary duties of those officers according to its jurisdiction, regulatory requirements. all of these positions were held by highly experienced professionals dealing regularly with local regulators

i take seriously my duty as trustee of mf global inc., to treat themic w equitably. i would look to present studies. a lack of supervision and inattention to maintaining segregation of customer accounts caused short fall of customer funds. the possible remedy is imposing personal liability on senior officers and directors where there is a regulatory short fall. consideration should also be given to requiring not only financial operating principles, but senior officers including the ceo and the cfo. to certify compliance with commodity segregation requirements on a much more frequent basis. secondly. i suggest the establishment of a commodities customer protection fund. we found that more than three quarters of the commodities customers had accounts of a value of less than $100,000 each. as the fund providing protection up to maximum of $100,000, would have made a substantial number of the claimants whole within days of the bankruptcy filing. third we have learned that many commodities customers have not understood the nature and risk of certain financial products in

bolen i believe, and stated effective immediately any withdrawals from mf global inc have to be approvedriting by the cme audit department. basically telling mf global not to move capital from mf global without cme's approval. who did you tell that information to when you received that letter? >> i -- i don't recall. at the time, it went to the finance group, to myself, and i cannot remember, you know, exactly what i did with it back on that thursday. i recall having conversations where people were aware. >> so did y'all seek approval when you made the $175 million transfer to mf global u.k. before you moved that money? did you notify cme you were making that transfer? >> i was not aware of that transfer before it was made so i would not know that. >> so if you didn't -- you don't know who you gave the information to, and so maybe not everybody got the memo, is that what you're -- >> again, the memo went directly to key finance people, and so i -- and the key people operating the, you know, transfers and things all in chicago. i assume it was shared there, but i really don't -- i don't r

mf global trustee, right? >> yes, sir. >> and what is your -- as trustee, just for the record, what is your portfolio? what are you supposed to do as a trustee for mf global, inc.? >> well, i am appointed the equivalent of a chapter 7 trustee, i have the equivalent powers, also as the broker/dealer. my job is to marshall the assets of the broker/dealer estate and to pay them out as required by law. there are sacrosanct property which is really not part of the estate, which belongs to customers. the commodities customer funds and also the securities customers' funds. and there are very detailed positions about the cftc right act and the cipa act that governs how you calculate those claims and pay them out. the big distinction and the big difference and the reason that, as mr. cook of the s.e.c. has pointed out, some of the securities customers have been paid in full, is the existence of the resources of the cipa fund which provides up to an additional $500,000 to cover losses in an account. >> is that $500,000 per account? >> yes, sir. yes, sir. $250,000 -- >> what is the average account? >> the average securities account -- >> at mf global. >> at mf global --

customers have lost huge amounts of money and collateral that was entrusted to the subsidiary mf global inc. we scrubbed our own cash collateral upon direction by the bankruptcy judge to make sure that none of the collateral in the estate is in any way related to or would be part of the customer accounts. and we concluded with no disagreement from the staff that the cash collateral that the estates now possess does not include any misappropriated or misdirected customer funds. let me also talk, and i'm pleased to be able to talk about the subject, the bonuses. this was raised very appropriately, senator tester, by you and clour colleagues. the source of this was, as you know, a media report. and i don't have control over what's in the media no more than than anyone in the media does. it was never my intention to pay any bonuses. i never had a plan to pay any bonuses. there were no discussions about myself and my staff about bonuses to senior executives. and bonuses are not part of my consideration now. they have not been in the past. i want to be as clear as i can about that. # my responsib

i take seriously my duty as the trustee of mf global inc to treat customers equitably. i would like to provide some proposals that may merit further study and of course input from regulators, experts, and the public. the possible remedy is imposing personal liability on senior officers and directors when there is a regulatory shortfall. consideration should also be given for requiring not only financial operating principles, but senior officers, including the ceo and cfo. requiring compliance on a much more frequent basis. secondly, i suggest the establishment of the commodities customers fund. we found that more than three- quarters of the customers have a value of less than $100,000 each. that is a fund providing for protection of up to $100,000 would have made a substantial number of the claims held within days of the bankruptcy filing. third, we have learned that many commodities customers have not fully understood the nature and risk of certain financial products in which their funds were invested. currently, commodities customers are not subject to suitability req

i take seriously my duty as the trustee of mf global inc to treat customers equitably. i would like to provide some proposals that may merit further study and of course input from regolith -- regular is, experts, and the public. -- regulators, experts, and the public. the possible remedy is imposing personal liability on senior officers and directors when there is a regulatory shortfall. consideration should also be given for requiring not only financial operating principles, but senior officers, including the c e zero -- the ceo and cfo. requiring compliance on a much more frequent basis. secondly, i suggest the establishment of the commodities customers fund. we found that more than three- quarters of the customers have a value of less than $100,000 each. that is a fund providing for protection of up to $100,000 would have made a substantial number of the claims held within days of the bankruptcy filing. third, we have learned that many commodities customers have not fully understood the nature and risk of certain financial products in which their funds were invested.

i take seriously my duty as the trustee of mf global inc., to treat commodities securities customers and general creditors equitably. i would like to provide some proposals that may merit further study and, of course, input from regulators, industry experts and the public. a lack of supervision and inattention to maintaining segregation of customer accounts caused the shortfall of customer funds. thus, a possible remedy is imposing personal liability on senior officers and directors when there is a regulatory shortfall. consideration should also be given to requiring not only financial operating principles, but senior officers including the ceo and the cfo to certify compliance with commodities segregation requirements on a much more frequent basis. secondly, i suggest the establishment of a commodities customer protection fund. we found that more than three-quarters of the commodities customers had accounts of a value of less than $100,000 each. thus, a fund providing for protection of up to a maximum of $100,000 would have made a substantial number of the claimants whole within day