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$1.2 Billion ‘Vaporized’ Under Obama Bundler Jon Corzine’s ‘Leadership’ at MF Global
Former New Jersey Governor Jon Corzine had little trouble finding $500,000 in his role as a top Obama campaign bundler, but locating the missing $1.2 billion in customer funds he oversaw as the head of MF Global funds is proving far more difficult–impossible even, reports the Wall Street Journal.
A person close to the investigation told The Journal that a “significant amount” of customers’ money appears to have “vaporized”:
Nearly three months after MF Global Holdings Ltd. collapsed, officials hunting for an estimated $1.2 billion in missing customer money increasingly believe that much of it might never be recovered, according to people familiar with the investigation.
As the sprawling probe that includes regulators, criminal and congressional investigators, and court-appointed trustees grinds on, the findings so far suggest that a “significant amount” of the money could have “vaporized” as a result of chaotic trading at MF Global during the week before the company’s Oct. 31 bankruptcy filing, said a person close to the investigation.
Many officials now believe certain employees at MF Global dipped into the “customer segregated account” that the New York company was supposed to keep separate from its own assets—and then used the money to meet demands for more collateral or to unfreeze assets at banks and other counterparties as they grew more concerned about their financial exposure to MF Global.
During a House hearing in December, Mr. Corzine said he “doesn’t know” where the $1.2 billion went or is.
MF Global chief missing $1.2B is financial adviser to EPA
During two days of recent congressional hearings into how as much as $1.2 billion disappeared from MF Global customer accounts, the chief operating officer of the imploding investment firm responded again and again that he did not know.
Yet as the House and Senate interrogated Bradley I. Abelow and other top executives at MF Global Holdings Ltd., lawmakers did not mention Mr. Abelow’s role as a financial adviser for the Environmental Protection Agency, which as of Tuesday listed him as the chairman of its financial advisory board.
Even as he finds himself the public face of a bankruptcy and admitted to lawmakers that he had no idea how client funds disappeared, Congress and the administration have voiced no public concern about Mr. Abelow’s role advising the $8.6 billion government agency on its finances.
“EPA relying on Wall Street for financial guidance is like the blind leading the blind,” said Jeff Ruch, president of Public Employees for Environmental Responsibility, a nonprofit environmental advocacy group based in Washington.
“In Abelow, you have a Wall Street executive who just presided over the disappearance of $1 billion in investor funds purporting to help guide federal infrastructure financing.”
The EPA did not respond to multiple… Continue reading
‘Super Tense Moment’ Occurs When Jon Corzine Is Served Papers During His Hearing Recess
The MF Global Congressional hearing today broke around 2 p.m. for a House vote, and as former CEO Jon Corzine was leaving the room, he got served with papers, CNBC’s Kayla Taushe has just reported.
Apparently, the papers were a lawsuit filed by Sapere CTA, a firm that has over $95 million locked up at MF Global. CNBC’s Taushe said there were over 20 other MF Global execs listed on the suit. A Sapere spokesperson declined to comment to Business Insider.
The video is definitely worth watching, as the man trying to deliver the papers to Corzine is snubbed with a simple “Talk to my lawyer,” drops the papers, only to have Corzine’s lawyer Andrew Levander pick them up as Corzine walks away.
Exit question: Does Corzine fully grasp how disliked he is in many corners? Furthermore, does he understand that many, many people suspect that he knows what happened to the missing $1.2 billion? If he does, he certainly isn’t acting like it. His lawyer might do him a favor and suggest that he act a little more penitential and a little less defiant.
Corzine Defends Tenure, Puzzles Over Missing Funds
Jon S. Corzine defended his tenure as chief executive of MF Global Holdings Ltd. before a House committee, but couldn’t explain an estimated $1.2 billion in missing customers’ money.
Visibly tense in the politically charged hearing, Mr. Corzine, 64 years old, on Thursday told the House Agriculture Committee that he has been “devastated by the enormous impact on many peoples’ lives” caused by MF Global’s collapse.
“I simply do not know where the money is,” he said in response to questions from the panel, noting that “there were an extraordinary number of transactions during MF Global’s last few days” and that he didn’t know everything that was going on.
Pressed for an answer as to what could have happened, he said it was possible, though unlikely, that underlings might have misunderstood an order and mistakenly dipped into customer funds. Mr. Corzine said he still expects that the money eventually will be found and recovered.
Mr. Corzine resigned as MF Global chairman and chief executive days after the firm’s Oct. 31 bankruptcy filing. Speaking in a deep, raspy voice, the former New Jersey senator and governor and Goldman Sachs Group Inc. chairman appeared as befuddled by what had happened to his firm as the regulators who have been attempting to resolve the matter for more than a month. It was his first public appearance since the firm’s collapse.
Frequently stroking his trademark beard and fumbling with his prepared testimony, Mr. Corzine argued that MF Global was felled not by its $6.3 billion bet on European debt, but rather by a sudden lack of confidence in its balance sheet by the broader market in October.
MF Global Swindle: House Committee Not Likely to Play Hardball with Corzine
Editor’s note: Following opening statement at Corzine’s House hearing, the video and audio feed on C-Span went mysteriously dead.
It looks like John Corzine’s appearance before a House committee will be little more than a formality. Corzine, the former Goldman Sach’s CEO, New Jersey governor, and boss of MF Global days before it went toes up and made off with $1.2 billion in customer money, is expected to say little or nothing and take the Fifth.
Corzine has retained Andrew Levander, a hired high-powered white-collar criminal defense lawyer, the New York Post reported yesterday. Sources told the newspaper Levander advised Corzine not to tell his side of the story during the House grilling today.
The former MF Global boss has apologized to customers swindled out of money.
The MF Global implosion is the largest since the 2008 bankruptcy of Lehman Brothers, in part triggered by $6 billion in gambling on European sovereign debt.
“I simply do not know where the money is, or why the accounts have not been reconciled to date,” he declared in a written statement. He said he was not sure if there were “operational errors at MF Global or elsewhere, or whether banks and counterparties… Continue reading
Corzine: ‘I Simply Do Not Know Where The Money Is’
Read: STATEMENT OF JON S. CORZINE BEFORE THE UNITED STATES HOUSE OF REPRESENTATIVES
A contrite Jon S. Corzine will express both sorrow and a firm defense of his actions Thursday in his first public appearance since the collapse of MF Global Holdings Ltd. in late October.
“Recognizing the enormous impact on many peoples’ lives resulting from the events surrounding the MF Global bankruptcy, I appear at today’s hearings with great sadness,” Mr. Corzine plans to say in testimony prepared for a hearing by the House Agriculture Committee, which subpoenaed the former MF Global chief executive Friday. A copy of the testimony was released early Thursday on the panel’s website.
The testimony Thursday is sure to be contentious. Mr. Corzine, who resigned as chairman and CEO of MF Global after its Oct. 31 bankruptcy filing, is a Democrat and former U.S. senator and governor of New Jersey.
He will face an intense grilling by the Republican-led committee, creating an atmosphere fraught with political drama. Mr. Corzine, 64 years old, received President Barack Obama’s support in 2009 for his unsuccessful campaign for re-election as governor, and more recently held a fund-raising dinner for Mr. Obama.
