MF Global Says It Misinformed Day Trader on Scale of Losses 2009-03-24 13:35:23.92 GMT
By James Lumley March 24 (Bloomberg) -- MF Global Ltd.s London brokerage unit told a U.K. judge that one of its former employees misled a day trader over the scale of his losses. MF Global will admit allegations of fraudulent misrepresentation made by Raj Gill, an independent trader and former client, MF lawyer Michael Brindle told a judge at the High Court in London today. Gill is suing for at least 9.3 million pounds ($13.6 million.) over claims that between April 2001 and February 2002 his account manager at the MF Global unit lied about trading results and failed to follow instructions, leading Gill to wipe out a trading account containing almost 10 million pounds. Brindle said that, while the company accepts that Gill was misled by the account manager, who has since left the company, it doesnt accept that the information caused Gills losses. Justice Julian Flaux said he would continue to hear expert evidence from brokers and accountants on the point. The speed with which MF Globals case has collapsed must not be allowed to detract from the seven years over which it has denied liability, taken every conceivable point, defended the indefensible and used its massive resources to try to bully into surrender the claims of a private individual it came very close to destroying, Gills lawyer Neil Kitchener told Flaux. Kitchener said that once the case was over, he planned to ask the judge to refer some files to the U.K. Financial Services Authority and U.K. prosecuting authorities. On March 9, the day the hearing started, Kitchener told the court that had Gill been given correct information, he would have known he was losing money and would have revised his trading strategy. He said that the minimum Gill seeks in compensation is 9.3 million pounds plus interest.
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--Editor: Jeff St.Onge, Peter Chapman
To contact the reporter on this story: James Lumley in London at +44 20 7073-3684
