Pardon my ignorance, but couldn’t the missing money be “losses” from the failed investments?
If someone were to buy $10,000 worth of say, Enron stock and Enron went bankrupt, wouldn’t the $10,000 appear to be missing?
They bought stuff on margin and the value declined making it necessary to come up with cash to cover the margin call. They ran out of their own cash and dipped into the cash in customer accounts. That is, they co mingled customer funds on account with the trading funds. More margin calls, more cash needed etc.
The practice is like the government dipping into the SS trust to co mingle the SS funds with those on General Fund Account.
They were betting on the come. The come never came
Finally the jig was up. They no longer could cover their losses. it was over. All the money is gone