James W. Giddens, Chairman of the Corporate Reorganization and Bankruptcy Group, authored an Op-Ed analysis: How to Avoid the Next MF Global Surprise (subscription required), in The Wall Street Journal regarding cross-border insolvency and his recommendations to ensure the protection of customer funds in future broker-dealer liquidations.
Drawing on his experience as Trustee of Lehman Brothers Inc. and MF Global Inc. – the largest and eighth largest, respectively, bankruptcies in U.S. history – Giddens noted that “U.S. laws and regulations should be modified to require that customer funds held outside the U.S. are subject to the strict segregation requirements in the U.S.” Further, he added that “regulators here and abroad need to coordinate their efforts to make sure that account segregation requirements are met and properly signed off by company officers.”