JOSEPHINE WANG

General Counsel

CHRISTOPHER H. LAROSA

Associate General Counsel

LAUREN ATTARD

StaffAttorney

SECURITIES INVESTOR PROTECTION

CORPORATION

805 Fifteenth Street, N.W., Suite 800

Washington, D.C. 20005-2207

Telephone: (202) 371-8300

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

INRE:

MF GLOBAL INC.,

Debtor.

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Adversary No. 11-2790 (MG) SIPA

MEMORANDUM OF THE SECURITIES INVESTOR PROTECTION CORPORATION

IN SUPPORT OF TRUSTEE'S EXPEDITED MOTION TO APPROVE

FURTHER TRANSFERS AND DISTRIBUTIONS FOR MF GLOBAL INC.

UNITED STATES COMMODITY FUTURES CUSTOMERS

The Securities Investor Protection Corporation ("SIPC") submits this memorandum in

support of the expedited motion ("Motion") ofJames W. Giddens ("Trustee"), as trustee for the

liquidation of MF Global, Inc. ("Debtor") under the Securities Investor Protection Act ("SIPA"),

15 U.S.C. §§ 78aaa et ~, for an order approving further transfers and distributions for the

Debtor's domestic commodities customers. SIPC concurs in the position expressed by the

Trustee in his Motion and briefly summarizes the basis for its support below.

First, the transfers proposed by the Trustee would enable the Trustee to return to

domestic commodities customers an additional $2.1 billion of property and to substantially
equalize, on a ratable basis, the percentage of assets returned to each such customer. Coupled

with the transfers and distributions made pursuant to the first two orders entered by the Court,

the proposed transfers, when effected, would result in the return to customers a total of twothirds or more ofthe property owed to them.

Second, the proposed transfers strike the appropriate balance between the need to retum

customer property to customers on an expedited basis - to minimize both the inconvenience to

customers and the associated disruption to markets - and the Trustee's obligation to distribute

customer property ratably to customers on the basis, and to the extent, of their respective net

equities. See II U.S.C. § 766(h). The Trustee has proposed to retain a reserve of approximately

15% to 20% of segregated property that is, or is shortly expected to be, in the control of the

Trustee. This reserve should protect against the risk that any distribution to a customer will

exceed the amount to which that customer is ultimately entitled in the liquidation as a result of a

shortfall in customer property.

Third, the proposed transfers are authorized by law. SIPA incorporates, to the extent

consistent with the statute, certain provisions of the Bankruptcy Code (II U.S.C.), including

Code Sections 105(a), and, to the same extent, or "as otherwise ordered by the Court, the Trustee

has the same duties as a trustee in a liquidation under the Commodity Broker Liquidation

provisions of Subchapter IV of Chapter 7 of the Bankruptcy Code, including those imposed by

Code Section 766(h). See SIPA §§78fff(b) and 78fff-l(b). Section 105(a) empowers the Court

to issue any order, process, or judgment that is necessary to carry out the provisions of the

Bankruptcy Code, and has long been recognized as a broad grant of authority to effectuate the

Code's provisions. See II U.S.C. § I05(a); Momentum Mfg. Corp. v. Employee Creditors

Comm. (In re Momentum Mfg. Corp.), 25 F.3d 1132, 1136 (2d Cir. 1994). Moreover, the

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Commodity Futures Trading Commission's ("CFTC") Part 190 regulations, which implement

the Bankruptcy Code's Commodity Broker Liquidation provisions, permit the CFTC to authorize

transfers of the kind proposed here in order to protect the public interest. See 17 C.F.R. §

190.06(e), (f), and (h).

CONCLUSION

For the reasons stated above and in the Trustee's Motion, the Court should grant the

Trustee's Motion and should approve the transfers and distributions proposed by the Trustee.

Dated: Washington, D.C.

November 29, 2011

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Respectfully submitted,

JOSEPHINE WANG

General Counsel

lsi Christopher H. LaRosa

CHRISTOPHER H. LAROSA

Associate General Counsel

LAUREN T. ATTARD

StaffAttorney

SECURITIES INVESTOR PROTECTION

CORPORATION

805 15th Street, N.W., Suite 800

Washington, D.C. 20005

Telephone: (202) 371-8300

Facsimile: (202) 371-6728

E-Mail: jwang@sipc.org

c1arosa@sipc.org

lattard@sipc.org