Congress Panel Blames Corzine for MF Global Fall

Wednesday, 14 Nov 2012 07:19 PM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
Poor management decisions by MF Global former CEO Jon Corzine triggered the brokerage firm's collapse, while lax protections for customer funds contributed to the loss of an estimated $1.6 billion of customer money, U.S. congressional investigators have determined.

Evidence unearthed by the House Financial Services Subcommittee on Oversight puts the blame squarely on Corzine, the panel's chairman, Rep. Randy Neugebauer, said in a preview of the report that will be released on Thursday.

"The responsibility for failing to maintain the systems and controls necessary to protect customer funds rests with Corzine," the report says. "This failure represents a dereliction of his duty as MF Global's chairman and CEO."

Corzine, a former co-chairman of Goldman Sachs who also served as a U.S. senator and as governor of New Jersey, has denied any wrongdoing.

A Corzine spokesman on Wednesday said: "While we have not yet been able to review the whole report, it is worth noting that ... the House Subcommittee apparently did not find any evidence that Mr. Corzine acted in bad faith or engaged in any intentional wrongdoing."

MF Global filed for bankruptcy more than a year ago, as investors scrambled to pull out funds after revelations the firm bet heavily on European sovereign debt and after credit downgrades.

Regulators, prosecutors and lawmakers have been looking into the estimated $1.6 billion in customer funds missing after the firm's collapse.

The House subcommittee said it has held three hearings, interviewed more than 50 witnesses and reviewed thousands of documents from MF Global, its regulators and other sources.

The report will show that risks were exacerbated by an atmosphere at the firm in which no one could question Corzine's decisions, the subcommittee said.

Corzine's spokesman said MF Global's significant business decisions were all subject to review by its board.

Corzine also kept his own trading activities out of the firm's risk management review process, the subcommittee said. The group said it also found that regulatory agencies had not shared crucial information with each other, and other problems.

A trustee liquidating the company's broker-dealer unit released a critical report in June that said that in his attempt to build the firm into a global investment powerhouse, Corzine failed to address growing liquidity needs.

© 2014 Thomson/Reuters. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Krauthammer: Obama 'Makes This Stuff Up' on Obamacare

Friday, 18 Apr 2014 08:09 AM

Conservative commentator Charles Krauthammer says that President Barack Obama makes stuff up with "brazenness" when he s . . .

Hillary Clinton's Book Title Revealed: 'Hard Choices'

Friday, 18 Apr 2014 07:53 AM

Potential presidential contender Hillary Clinton's memoir of her four years as secretary of state will be called "Hard C . . .

Gallup Poll: Record Disapproval Ratings for Obama on Economy

Thursday, 17 Apr 2014 22:41 PM

More than half of Americans said they had virtually no confidence in President Barack Obama's ability to improve the nat . . .

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved