James Koutoulas Co-Founder Commodity Customer Coalition - MF Global Bankruptcy

[beornborg1]

It's good to see that investigative Journalism is alive an well ... someone should tell the "News" people about it.

[jensarmbag]

If it wasn't for James all of our $ would be gobbled up by JP MORGAN & CHASE! Thank u for representing the people.

[the11thone]

Yes, money market accounts, but the entire US banking sector. European exposure= Goldman $28 billion; RBC $53 to $126 billion; Wells Fargo $19 billion; JP Morgan $546 billion; Morgan Stanley $410 billion. BUT the one that worries me is that Interative Brokers was playing the same hypothecation game as MFG and they have $14.5 billion at risk, probably in England to avoid US laws, just like MFG. Somebody needs to ask the right questions about where that $14.5 billion came from. (any guess?)

[anujbahl]

warren, were you a MF customer?

[wepollock]

@anujbahl yes.. I have recovered 60% of 35K If it was up to the Trustee on his own it would be zero! JK has helped immeasurably. 

[robert4you]

Great work. Great video!

[the11thone]

The handling of this by a judge and appointed trustee who have no understanding of the futures industry and workings is extremely troubling. The way it is being handled is and will have huge ramifications, as you know and have tried so hard to get people to understand--people at CME who should understand. But what MF has exposed is the suicidal leverage of the daily dealings of banks around the world. The amount of liquidity being privately created dwarfs anything the FED is doing. Insane!

[wepollock]

@the11thone yep.. this will/can hit many-most money market accounts should Europe fail to find stability in the next day or two.

[the11thone]

Warren, I agree with you 100%. They should be fiduciaries, but they're not. They are acting for their own account--clients are only a means to make money for themselves. One problem is that the exchanges should not be profit oriented. They should be non-profit and held to a very high, also fiduciary, level of integrity. The present exchange leads to graft, corruption, favoritism, insider info sharing. Unfortunately, the only solution is total collapse--result is riots, death and starvation.

[wepollock]

@the11thone yes they were all MUTUAL COMPANIES.. I asked the COO of the CME if he was going to talk to the member firms to make MF Global customers whole. He did not have a clue. IMHO

[the11thone]

What was done was immoral and wrong but other than saying that mixing balance sheets was illegal, where is the law? A violation of a policy or directive, but what penalty? In the fine print of the agency agreement, clients probably granted the right to the broker to loan out their funds in outside jurisdictions to be repo'd and hypothicated and rehypothicated outside of the brokers control and possession. It's wrong, but was agreed to. No prison or penalty--took advantage of legal loophole.

[wepollock]

@the11thone the offenders are going to argue its a loophole. but these are fiduciaries with a higher benchmark of conduct required that places customer interests first above their own. Such a breach could be ruled criminal. Also to have reform we need a court to say that these bankers have public fiduciary responsibility. In an educated culture you need less laws. The US law has become far too detailed thereby allowing large loopholes. Also there is Sarbanes Oxley.

[LIANNAROBERTDANE]

Great Work !! It is a good thing you live in New York :)

[wepollock]

@LIANNAROBERTDANE thanks for the support..

[richco7773]

Seize the personal assets of Corzine.

[bullsnutsoz]

This is what we need; intelligent citizen journos commited to the betterment of the people who will go after these toerags and ask the questions we all want asking.

Its quite obvious why noone buys papers or watches TV news any more. The elite have lost it and they know it! Thanks Warrem!

[americanbandwidth]

This is good work, it's what John Wayne would have done.

How did this guy find pants that can hold his balls?

[SGTbull07]

Excellent citizen Journalism! Thank you -

[RichVoyages]

Good to see you on the street Warren.Taking it to the street and talking to the people who are really effected by all this economic down turn is great to see. I was out Thursday taping the FCC Public Forum here in Atlanta.Man how the government has let the big boys take over. Keep up the great work.

[dalexfilms]

"Our man in New York" (Since nobody else is willing to cover it)... Thanks, Warren!

[wepollock]

@dalexfilms fortune followed me a few days later..

[iansuderman]

I am hoping some people will see the Japanese similarity. Think outside the American box. Japans experience with massive amounts of people retiring was only survivable with massive amounts of savings. America just doesn't have access to that.

The 1% understood that and looked for any way out. That was the sub prime fraud.

In the end the large segment retiring will cause its own crash.

[wepollock]

@iansuderman yes its all connected MENA, Japan and nuclear breakdown, bailouts in Europe, cut off supply afghanistan, Iran flexing, Turkey Flexing, reversal of pipelines in the US, this debacle, stamp down of OWS worldwide..its total systems collapse breakdown crisis. it can be turned around with some integrity.. even a bit.

[pjamesbda]

Warren, great piece of reporting, and you didn't let CNN scare you off either. As you pointed out they have allowed it to fester into 50 million in legal fees because that is the status quo. No matter what the set of grievousness in the end the lawyers always walk away with the lion's share.

Doctors and Lawyers, whadaya gonna do?

[bweazel]

Nice job, wepollock. Great interview.

[wepollock]

@bweazel spread this one around. I scooped CNN, Reuters, and now as a laggard Fortune Mag.

[fatboy407]

Warren, I think your BULLDOG MODE is much more productive than your typical ultra-reserved manner. Even in bulldog mode, you have control. Push forward BULLDOG!

[CajunMojo222]

Interesting ... consider the word spread "on my part".

[GuildF40]

Go get'em Floyd

[bammbamm12]

The "ultimate epitome"? And this guy's a lawyer? That's like saying "Italian spaghetti". "No skin off their teeth"? Hahahahahaha!!!!!

("no skin off one's back", or "by the skin of one's teeth").

[wepollock]

@bammbamm12 that guy is a 30 year old hedge fund manager who founded his own firm managing millions of dollars. he got the law degree as a secondary matter.. now he gets to stand up to the big guys... not only is he in court (a place many a lawyer never sees) he is up against teams of people with the ultimate in on the job training.. he is a great guy.

[bammbamm12]

@wepollock - I'm on my knees. Prostrated.

He needs to study English.

I believe he's a good guy - all the more shame.

[wepollock]

@bammbamm12 James is a great guy.. As to english I feel like I am eating word salad from time to time.. btw feels like I am getting screen scrapes here..

[vantagepointmoon]

You could teach a lesson or two on reporting to any MSM outlet, fat cats forgot how to do that.

[RoberTastic]

awesome vid !

[zeropointpower]

BULLDOG!!!! GRRR!!!  Great job Warren.

[solojam]

awesome buddy you are taking over the system, your a boss, you should do more stuff in the arena, you destroy the media outlets

[wepollock]

@solojam MY success in this effort depends on people spreading the word..

[FreedomForYouAndMe]

Warren, GREAT GREAT GREAT video!!! Keep this up....we are winning!

[wepollock]

@FreedomForYouAndMe PLEASE spread this around via Facebook, friends, family, and blogs.. its not getting the exposure needed to effect change

[kileer7]

Warren, you would probably reduce CNN, Fox News, MSNBC, CNBC, and Reuters' "analysts" or "reporters" to tears. They're scared to death of people like yourself. Keep up the good fight, you're amazing.

[wepollock]

@kileer7 thanks thats nice to hear.. please spread the video around and help the cause.

[kileer7]

@wepollock Believe it or not my Mom is subbed to your channel, and every time you upload a new video she talks to me about it ... usually about the vulgar comments I post LOL!

[stagflation2010]

Hey Warren, I think this is one of your best YouTube postings. Great info!

[budb11]

This is being staged at the wrong courthouse, should not be bankruptcy, it should be the criminal courts.

Warren, we are all proud of you! We're proud of you using your time, your expertise, and especially your spirit. Don't think you are alone in your work. Come up with ideas on how your supporters can help.

[rjg1021]

Bringing that primary source information. Thanks, Warren

[wepollock]

@rjg1021 nobody knows the difference between opinion pieces and news. I have developed a whole news story on MF Global having spoken to all the key regulators and some of the players. Opinions are cheap, news is expensive (in terms of personal and financial cost). This story as reported has gained little distribution and traction. Its being drowned out by opinion.

[rjg1021]

@wepollock I'm grateful to you. I'm an MF Global customer (about 60% whole...) and you have been my primary source since 10/31 alerting me to key developments and referring me to MFG Facts. Thanks again.

[cathrynm]

Corzone a chicken? Hardly, that guy has balls of steel, when it comes to gambling with stolen money.

[cathrynm]

I know.  What a scam. Money stolen and NOBODY in jail. Outrageous.

[KhmerD0g]

amerika is screwed

[staywithtruth]

Farmers unable to hedge means they plant less. High food prices & shortages. Bernanke gave a speech in Aug. 2011 on the vital role of clearinghouses; that clearinghouses have weathered economic crisis Ben attributes partly to "a degree of good luck". Corzine should have already been in front of a Grand Jury; having dissed a House of Rep. hearing to question him, Corzine is cordially invited to a Senate hearing for questioning instead of being issued a subpoena.

[staywithtruth]

So why hasn't the CME come up with the funds YET to backstop? According to Lindsey Williams plan of the elite by end of 2012 is: written on paper, worth paper written on. destroy wealth. MFG is a ball in play to bring that about. As Wepollock states if CME doesn't back stop it'll be the end of financial markets. FX market kept afloat by direct meddling of the Federal Reserve through CLS Corp. FX probably last to go.

[sgone0]

Hope that was not billable time!

[TinQuasimodo]

"Are you cold?" hahaha! Damn, Warren, you had him shook. Way to take it to them!

[wepollock]

@TinQuasimodoCNN was torturing the guy! They had him in a holding zone for one of their upstairs press-monkies in CNN headquarters. I was going to ask questions and then they were chasing us away, and blocking our photography.. Did you hear all them blasting Greg (videographer) and I pushed in.. Also did you hear the condescending Reuters guy in Starbucks.

[FullAccessAgent]

03:25 - Ben Bernanke in line at Starbucks!!!!!!!!!!!

[jimbobubbadj]

Warren, I didn't realize that you are so short. I pictured you being a tall man LOL. Thanks for posting.

[wepollock]

@jimbobubbadj he is very tall.. I am not very short lol

[MrOregona230]

Ben Bernanke in the background at 3:24?

[MrFeatherian]

@MrOregona230 look like him tho ,

[aboutsoul19]

Awesome Sir.

[the11thone]

Warren, As I understand it the brokerage can deposit excess margin overnight in treasury or money market or any interest or non-interest account. Congress passed a law that allows the brokerage to keep the float money that is earned or paid out from the short term deposit. It sounds like in the MFG case MF decided to deposit the excess margin in high interest junk sovereign bonds to collect more income. They margined the excess margin money and the bet went sour. Was there a law broken?

[wepollock]

@the11thone 1) the money is not supposed to be in Junk.. its supposed to be in the highest quality paper.. 2) the money has to be kept in the same corporation; it cannot cross a balance sheet into another entity engaged in speculation 3) it cannot be used to cover speculative losses - again the balance sheet issue I mentioned 4) what was not regulated was the idea of conducting a "repo" where customer treasuries are lent overnight (for kiting)

[the11thone]

@wepollock Thanks, Warren, for filling in the blanks in my understanding or lack of understanding. Is it illegal for the brokerage to invest excess margin money with third parties? I know that what MF did was morally wrong and common sense would shout that it was dangerous, but I fear the law is written so broadly that the court will find that the investment was not illegal--the way may have been--but it was just a bad bet. I'm glad that moving money to another balance sheet is illegal.

[wepollock]

@the11thone Conducting repos with treasuries was allowed (Corzine lobbied to prevent regulation against it) and also kiting margin internally was allowed. That is why the question of crossing a balance sheet is so important. Customer accounts cannot be placed in Junk (that is illegal), you cannot speculate with customer funds (that is illegal), you cannot remove funds from a customer brokerage account to a speculative entity in another balance sheet (that is illegal).

[wepollock]

@wepollock you cannot use customer funds to cover your speculative losses (basic theft), you cannot break a fiduciary relationship (that is illegal). you cannot run a ponzi scheme (that is illegal)

[TonyUnplugged]

Where is the NY Attorney General or a DOJ prosecution attorney ?

[buddy85442]

Warren, great reporting great work,You are a truth seeking missile!! Proud of you!!

[Frequencitee]

Warren,

I commend you not only for the quality questions/reporting, your passion and intimate knowledge of these issues, but just as much so, for keeping a calm, reserved, professional demeanor. You are very balanced when I comes to catalyzing constructive dialogue.

I know I'm not the only one who wants to make high-quality, dependable, industrial-strength hangman's nooses right now, in response to tyrannical behavior, but it's still too soon to give up on diplomacy.

[wepollock]

@Frequencitee Thanks,, I forgot to talk about WAREHOUSE RECEIPTS. The retiree I spoke to had some (gold and silver) The trustee is treating them as POOLED property, not IDENTIFIABLE property. If that is the way a court will treat them there is absolutely no point in having them.

[666katch]

Way to go, I am so impress, Thumbs Up and keep up the great work!

[bozeman14]

i told you about the capital increase in july. i suspected it was jp morgan. half was unsecured - well how is this working out?

this whole thing stinks.

[fatpius]

luv'ng it bulldog! 

[drkevincampbell]

Great work Warren. Next film should be you going after Corzine with some hard questions. He should be under one of the rocks on the side of the road.

[wepollock]

@drkevincampbell let me know where he is and I will ask him a question. Lets see if NYC will issue me a press pass so I am less at risk (not that I need to, or should have to ask their permission). I have a meeting in December.

[ftwbk]

warren, if u haven't done so already in a previous vid, please discuss the difference between type 1 and type 1 accounts. is it accurate that the brokerage is allowed to use funds from a type 2 account for its own trading purposes? if so, is that money backstopped by a gov't guarantee?

[wepollock]

@ftwbk good point.

[turbomango]

Good job, Warren.

[gottagetatubename]

Warren, I absolutely love this, questions being directly asked by people like yourself as the "other"reporters do not ask intelligent to the point questions. Keep this up as much as possible. Love It

[wepollock]

@gottagetatubename 2.5 man work days Gregg and I , $5K worth of equipment, plus expenses ($100) = 7 minutes of quality news.. For CNN it was 5 onsite man days paid, a tens-millions of dollars at hqrs, a van worth hundreds of thousands, camera worth 30K etc = 2 minutes of crap news.. That is why CNN CNBC FOX MSNBC NYT BLOOMBERG Reuters are just making stuff up.. I would like to do this daily but economically impossible.

[wepollock]

@wepollock I would be off to Fukushima if commitment was there. I paid for a Raid Array with user support and it was controversial. 

[wepollock]

@wepollock The only guy who funded real news in the modern era was Ted Turner...

[hickoryhound]

@wepollock I don't think having one (maybe a few) nimrods call you out for trying to raise funds controversial. You just keep doing what you see fit and don't worry about the nimrods. Most of us here sincerely appreciate your work.

[cpswyl2]

You look taller in your other vids, Warren. Good job bulldog ;)

[wepollock]

@cpswyl2 Its command presence - aka the bull dog.. 

[cpswyl2]

@wepollock Tsk tsk, we'll have less of that self-depreciating humour pls, 'bull dog' - now that definitely is CNN et al

[pfcwar5150]

Great reporting wepollock

[wepollock]

@pfcwar5150 thanks.. it was actually reporting.. one of the five CNN folks was trying to block the photography. The on site person had an earpiece back to the "brains" of CNN who controlled her like a marionette zombie.

[pfcwar5150]

Both of you looked as cold as Corzines heart. lol

[wepollock]

@pfcwar5150 James is a brilliant guy.. I have to put on a suit one of these days.... I tried to stay out of one since 2001..

[IrradiateTheNWO]

only a conflict of interest to those who get all jammed up

[hrustygmail]

Keep the great videos coming WEP. This is just the tip of the iceberg.

See.... Civil Action #8500 at the United States District Court for the Southern District of New York on November 23, 2011.

[wepollock]

@hrustygmail if you could send me a link..

[wepollock]

if you could send me a link in email.. I was up to 3am last night and on a train at 8am..

[wepollock]

If you don't like this video go watch CNN (or Fox) at your peril..

[kileer7]

@wepollock You were great Warren.

[KnowledgeDriven]

@wepollock great vid, warren! and thanks to greg too for putting up with those corporate camera monkeys! omfg... speaking of oMFG, i sent u a PM with reply from shankystechblog board where i shared the vid.

[ThePatriotMuckraker]

@Buddy3315

Remember, they get to carry guns, we slaves are not allowed.

[93or97]

And Corzine is not eating prison food because why?

[martialarm]

Its bulldog time.

[kileer7]

I apologize for being coarse. Jon Corzine is the epitome of failure to me, and I expect a clown like him to face SEVERE legal consequences for his actions.

[artdeco101010]

That was awesome!

[moofph]

...great work...and a tip of the hat to both of you for speaking up for what is right.

[MrTreign]

Warren...incredible interview.

[joelb79]

Real journalism. Thanks Warren.

[IAm010110]

Haha. "Are you cold?". Standing in line at Starbucks is the perfect opportunity for a 10 minute interview. Genius.

[spookyfish21]

Thanks Warren!

[Chitchatcheeko57]

Great! Questions that needed to be asked. The mainstream media can be deceptive.

[UU361]

The whole financial system is just one big ass scam, he knows it, you know it, and every member of our corrupt government which is infested by bought and paid for banker and corporate whore criminals knows it too.

[wepollock]

@UU361 so is the idea of "reporting," its a total scam.. I am the only party doing anything real in what would otherwise be a Kabuki theater.

[bryphi77]

@UU361 I agree...