How to Protect Yourself From Another Jon Corzine's MF Global Situation.

[nbruno322]

Interesting, information...Article deals with how to protect yourself from the risks of an over-leveraged broker practicing rehypothecation (like MF Global) by using the Direct Registration System and foreign brokers.

http://www.internationalman.com/78-global-perspectives/1080-the-drs-going-direct

[Ronin Truth]

Not trusting a crook with your money is a pretty good place to start.

[nbruno322]

I found this paragraph from the free report especially useful in explaining the situation to those not familiar with rehypothecation.

"Perhaps an analogy will be useful to illustrate the breathtaking audacity of this arrangement. Consider, for example, what would happen if the same principles were applied to automobile ownership. Let’s say that you purchased a car for cash. Despite that, the dealer could continue to treat your car as his asset, and use it as collateral to borrow money for his own purposes. If the auto dealer subsequently went bankrupt, your car—along with all of the others sold by the dealer—would by law be seized by the bankruptcy receiver, and could be used to settle the secured claims against the dealership."