Fortunately, I suppose, I had a very small account here. I feel terrible for all those retail traders (and MFAs, for that matter) that had a big chunk of their tradable funds here... Small Traders Left Adrift After MF Global Collapse Small traders and investors were reeling for the second day following the collapse of MF Global Holdings Ltd., with the brokerage's clients unable to trade or recover funds from their accounts. Confusion reigned among firms with money held by MF Global. Brokers and money managers realized that their accounts at the brokerage were inaccessible after they tried in vain to transfer funds and close out positions. "We're basically staring at a brick wall," said Sean McGillivray, a broker at Great Pacific Wealth Management. Mr. McGillivray, who has $5.5 million in client funds at MF Global, has been awake since Monday morning trying to liquidate clients' positions and transfer accounts to another clearing firm. "We've been dealing with MF," he said. "But we haven't gotten an explanation." Concerns about how to recover those funds mounted after a report that the Federal Bureau of Investigation plans to investigate MF Global in the wake of its bankruptcy filing and questions about a possible shortfall in client funds, according to a person familiar with the matter. A federal official, speaking on the condition of anonymity, later clarified that regulators have not frozen assets, adding they have been frozen as part of the bankruptcy process. MF Global didn't return requests for comment for this article. A lawyer for MF Global at a Tuesday hearing in bankruptcy court said, "To the best of my knowledge, there is no shortfall" in customer accounts. Meanwhile, CME Group Inc. sought to rally major clearing firms to take on parts of MF Global's client base, an effort that could free up some customer money trapped by the brokerage firm's collapse Monday, according to people familiar with the situation. The world's largest futures exchange group, which counted MF Global as one of its biggest customers, held a conference call Tuesday morning with major clearing members to outline the plan, according to people close to the situation. CME's goal was to complete the effort within about 24 hours, one of the people familiar said. MF Global collapsed under the weight of several billions of dollars of exposure to European debt, mounting losses and ratings downgrades. While the firm is a small fry compared to many Wall Street powerhouses, it was a major broker on U.S. futures markets. As of Aug. 31, the firm held $7.27 billion in segregated client accounts, according to a report filed with the Commodity Futures Trading Commission. Clearing firms such as MF Global hold customer money and work with exchanges such as the CME to post collateral and take care of other operational activities. Customer funds are supposed to be segregated into individual client accounts that cannot be touched by a firm for its own bets on the market. Moving an account from one broker to another usually is a rudimentary task, quickly completed between the two clearing firms when customers decide to switch where their funds are held. The CFTC and the Securities and Exchange Commission late Monday said there were "possible deficiencies in customer futures segregated accounts at the firm." The Securities Investor Protection Corporationâa federally created entity designed to help investors recover assets from failed brokeragesâsaid it is initiating the liquidation of MF Global. With money unaccounted for, fear began to take hold. "This is the first time in history that segregated funds have been frozen," said Michael Cox, broker and treasurer for Dallas-based Metis Resources, whose clients are companies that use futures to hedge their exposure to commodity prices. "We're just like everyone else, scrambling to make sure we're first in line to get our money." In a scene that played out on trading floors in New York and Chicago, brokers with funds at other clearing firms traded as normal while their colleagues tied to MF Global were stuck on the sidelines. Volume was thinner than normal in crude-oil futures traded on the New York Mercantile Exchange, while trading in agricultural markets also fell below average levels. "We're still waiting to get cleared to trade," said Joe Santagata, an oil trader on the Nymex. He has been trying since Monday to switch his clearing firm to INTL FCStone from MF Global, but has been unable to do so. Erez Kreitner, who trades commodities and stock futures and has cleared his trades through MF Global for years, hasn't been able to trade all week. His MF Global account is frozen with about $100,000 in it, and he's trying to open a new account with another clearing firm. "It's stressful," said Mr. Kreitner, who is based in New York. "Everything's a little bit in limbo." He withdrew other funds from his MF Global account out of caution last week, as he saw the company's problems mounting. "It just felt like Lehman all over again," he said, referring to the 2008 bankruptcy of the Wall Street firm. Mr. Kreitner still expects to get his money back from the MF Global account eventually, but he doesn't know when. In the meantime, he can't trade. "If I put in a trade electronically, it says this account not authorized," he said.