Report: Corzine ordered $200 million transfer

Former New Jersey Gov. Jon S. Corzine

/ AP/Rich Schultz

(CBS/AP) WASHINGTON — A former MF Global executive is contradicting testimony from Jon Corzine, saying the former senator ordered the transfer of $200 million out of a customer account days before the firm collapsed, according to an email message obtained by congressional investigators.

Edith O'Brien, the former assistant treasurer, says Corzine ordered the money shifted to one of the firm's bank accounts overseas, according to a memo that cited the email message.

The email noted that the transfer was made "per JC's direct instructions."

MF Global filed for bankruptcy protection on Oct. 31. The firm failed because of a disastrous bet on European debt. About $1.6 billion of customers' money hasn't been recovered.

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A House Financial Services subcommittee released the memo Friday in advance of a hearing Wednesday. O'Brien has been subpoenaed to testify. The Associated Press could not reach her for comment.

In December, Corzine told the panel: "I did not instruct anyone to lend customer funds to MF Global or any of its affiliates." Corzine also told the subcommittee he didn't know about "the use of customer funds on any loan or transfer."

And Corzine told a Senate panel two days earlier: "I never gave any instruction to anyone at MF Global to misuse customer funds."

A representative for Corzine didn't immediately return a telephone call seeking comment.

Client money is required by law to be held separately from a brokerage firm's cash to protect investors in case a firm fails. If MF Global misused client money, it would violate a fundamental investor protection for people who trade options and futures.

Many lawmakers have heard from farmers, ranchers and small business owners in their states who are missing money that was deposited with the firm. Agricultural businesses use brokerage firms like MF Global to help reduce their risks in an industry vulnerable to swings in oil, corn and other commodity prices.

Corzine, a former New Jersey governor and U.S. senator from the state, led MF Global until early November. He testified before three congressional panels in December. He said he didn't become aware of the shortfall in customer money until hours before MF Global's bankruptcy filing.

No one has been charged in the MF Global case. In addition to Congress, federal regulators and a federal grand jury in Chicago are investigating.

[ksmit2]

Doesn't matter who is president, or who someone's friends are,
a crook is a crook. Another "Master of the Universe" who says
he didn't know his company has a problem until the day before it
declares bankruptcy. Yet the masses still worship at the house
of the Holy Derivative. Never invest in something you cannot
comprehend, on at least a basic level.

[wfw3536]

And just a couple of years ago Obama and Biden were falling all over their good friend Corzine. With friends like that he'll get off and get away with cheating thousands of regular folks out of their money.

[dave811103]

To believe that he is not involved criminally, you would have to believe that a subordinate put BILLIONS of dollars at risk on his or her own and he never became aware of it. The former Governor of one of the most populated states in the country and the former head of Goldman Sachs defense in court will be I'm not a criminal; I am incompetent and had no oversight of my company. The lack of personal accountability and the ease in which people will crush someone else just to get ahead is depressing.

[RobAla]

Corzine was once a darling of the Democrats, but he is an outright slime-ball.

[dave811103]

I don't care about the politics, because there are slimeballs on both sides; in fact a majority of them probably are. I have to say though that at the risk of encouraging suicide, I do miss the days when if you woke up and realized you were one of the biggest slimeballs on the planet, an embarrassment to your friends and family, you quietly ate a bullet and we all moved on.

[smittyc]

Corzine is untouchable. 1 Obama supporter 2 Former Governor 3 Former Senator. He is a standard bearer for the Democratic party their politics and policies 1 Power 2 Greed 3 Corruption

[fedup12]

A tip of the GOP Congress iceberg.

[bmounts]

Who's at the tip of the Iceberg? Mr "Fast and Furious" himself leading the fight for illegal aliens and againt American citizens.

[djseavy]

And people are surprised why? This has become the norm. Government is as corrupt as the financial industry and there isn't a damn thing we can do about it. Because big businesses with very deep pockets bankroll the policians into office, the average citizen's vote is useless these days. Even if we're able to vote in the people we want, in the end, it turns out most of them are crooked too. Some like to pin it all on Obama, but this has been going on long before Obama was born, and will continue. The only way to change it is to clean out the entire system, but that's an impossibility the way things are set up. I am truly surprised Blogovich is actually doing time. Usually strings are pulled and politicans are simply swept under the rug after embarassing their party. I guess nobody liked the former governor.

[bradkt1]

This guy is a crook! Don't try to tell that he just doesn't remember telling someone to transfer 200 MILLION DOLLARS out of a client account into his firm's overseas account just before the firm goes under.

Put him in jail!

[myabc123]

Gee whiz! Another Goldman Sachs alumni that needs to do the "perp walk" --- but probably won't. This is why the average joe has lost all confidence in this financial/political system. The foxes are guarding the henhouse, both political parties are for sale, the rich would sell their country down the river for an extra nickel and the middle class is at deaths door because of it.

[kbbpll]

Gee, he's from New Jersey?

[retm-w]

That's what happens when you trust Wall St. with your money.

[BWB2020]

Funny thing.

Playing Wall St. has always been nothing more than a bet on a fixed race, yet suckers still pony up to be taken.

Their own fault.