Former MF Global Official Says He Warned Corzine

Published February 2, 2012 4:45PM (EST)

WASHINGTON (AP) — The former chief risk officer of MF Global says he warned then-CEO Jon Corzine in late 2010 of the risks in large bets on European government debt. Those bets sank the brokerage firm last fall.

Michael Roseman, who left MF Global in January 2011, was testifying Thursday at a hearing of a House oversight subcommittee. Lawmakers are looking at why MF Global failed and became the eighth-largest U.S. bankruptcy.

About $1.2 billion disappeared from customer accounts.

Roseman says that in October 2010, the firm's bets on European debt approached $3.5 billion to $4 billion, and he expressed concern. In January 2011, he says, he was replaced in his job.

He testified that his views on the risky bets were "certainly" a factor in his removal.

By Salon Staff

MORE FROM Salon Staff

Related Topics ------------------------------------------