MF Global Holdings Ltd. (NYSE: MF), a New York-based broker-dealer, has announced the preliminary settlement of the securities class action pending against the company in the S.D. of New York. The case, originally filed in March 2008, stems from allegations that the registration statement and prospectus issued by MF in connection with its July 2007 initial public offering were materially false and misleading because, among other things, it misrepresented the company’s risk-management policies, procedures and systems.
The settlement is for $90 million, of which $2.5 million will be paid by MF and $32.5 mllion will be paid by MF’s former parent company, Man Group PLC. MF’s claim for insurance coverage against the loss remains pending. Bloomberg has an article.