Jon Corzine charged in connection with MF Global collapse

The CFTC and MF Global have agreed to settle all of the civil charges filed against the firm


Jillian Rayfield
June 28, 2013 12:51AM (UTC)

The Commodity Futures Trading Commission has filed civil charges against former New Jersey Gov. Jon Corzine and the futures firm MF Global, in connection with the customer funds that went missing in the last days before the firm collapsed.

MF Global agreed to pay a $100 million penalty and pay all of the money still owed to customers, as part of the settlement deal with regulators.

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The CFTC found that former Assistant Treasurer Edith O'Brien was responsible for improperly transferring some of the missing customer funds to other accounts in the final days before MF Global went under, to help pay off some of the firm's other debts. O'Brien was charged with "aiding and abetting" the misuse of the funds.

Reuters reports:

MF Global collapsed in October 2011 under the weight of aggressive bets on sovereign debt, thin capital and questionable disclosures to investors. Customers were left reeling after it was revealed that more than $1 billion of their money could not immediately be found.

Corzine, a former co-chairman of Goldman Sachs and New Jersey governor, was charged with violating his legal obligations to diligently supervise. He was also charged with not acting in good faith as a "control person" at the firm.
The CFTC is seeking "full restitution and penalties against Corzine and O'Brien, as well as trading and registration bans against them," according to Reuters.

Jillian Rayfield

Jillian Rayfield is an Assistant News Editor for Salon, focusing on politics. Follow her on Twitter at @jillrayfield or email her at jrayfield@salon.com.

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