Canadian banks appear to be deeply involved in dipping into their client's assets to obtain funding for themselves, a la MF Global. Note, once your bank or brokerage has sent your assets to the UK and a firm there has then re-hypothecized them, you will not see them again if your financial firm's bets go bad. The regulation is so poor it is up to the individual investor to arrange limits on their financial firm's actions regarding their own assets.
MF Global and the great Wall St re-hypothecation scandal
firms have been piling into re-hypothecation activity with startling abandon. A review of filings reveals a staggering level of activity in what may be the world’s largest ever credit bubble.
Engaging in hyper-hypothecation have been Goldman Sachs ($28.17 billion re-hypothecated in 2011), Canadian Imperial Bank of Commerce (re-pledged $72 billion in client assets), Royal Bank of Canada (re-pledged $53.8 billion of $126.7 billion available for re-pledging), Oppenheimer Holdings ($15.3 million), Credit Suisse (CHF 332 billion), Knight Capital Group ($1.17 billion),Interactive Brokers ($14.5 billion), Wells Fargo ($19.6 billion), JP Morgan($546.2 billion) and Morgan Stanley ($410 billion).