Corzine Basically Last Person on Earth Who Knows How He Lost $1.2 Billion
Look, guys, Jon Corzine was just as shocked to hear that $1.2 billion in customer funds went missing from Jon Corzine's brokerage firm MF Global as people who weren't in charge of that money. The last few days that he was in charge of the now-bankrupt firm were, in his words to a congressional committee that called him to testify about it, "chaotic." So what he is saying is, maybe it fell out of his pocket while he wasn't paying attention, during the chaos? If it makes everyone feel better, he also checked underneath his couch cushions and the glove compartment of his car -- nothing. Weird, right? Has someone checked with one of his former employees or something?
The big stink here is that it would be illegal for the firm to have used customer funds to shore up its bad bets on European sovereign debt, and in fact the firm was required to keep those funds completely separate. Of course Jon Corzine knew this, right?
From the NYTimes DealBook:
“I never intended to break any rules,” said Mr. Corzine, dressed in a dark suit but without his trademark sweater vest. “I know I had no intention to ever authorize the transfer of segregated moneys. I know what my intentions were.” Mr. Corzine has not been accused of any wrongdoing.
He did not rule out possible wrongdoing at MF Global. In theory, an employee may have misused customer cash after misinterpreting the chief executive’s words, he said.
Ah the old "blame the incompetent employee whose name I've already forgotten" strategy. It's not Jon Corzine's fault if some employee misread the winky emoticon in some Gchat conversation.
But the important thing is, it was never his intention to use customer funds to bankroll the company, except for the part where he lobbied to do exactly this:
Mr. Corzine, who was defeated for re-election as governor of New Jersey in 2009, also defended his dealings with regulators. Months before the firm failed, he began a personal lobbying blitz, urging regulators at the Commodity Futures Trading Commission to weaken a rule that would rein in the use of customer funds.
Right then. [DealBook]