House report on collapse of MF Global blames Corzine

Former New Jersey governor and MF Global CEO Jon Corzine testifies on Dec. 8, 2011, in Washington. / Mark Wilson/Getty Images

WASHINGTON Republicans on a House panel that investigated the collapse of the brokerage MF Global are pinning the blame on ex-CEO Jon Corzine, a former Democratic senator and governor.

The Republicans say the investigation has found that Corzine's decisions caused MF Global's bankruptcy in October 2011 and its loss of more than $1 billion in customer money.

They say Corzine turned the brokerage firm into an investment bank making risky trades. They also say Corzine ran the firm in an authoritarian manner and didn't allow anyone to challenge his decisions.

The firm failed after betting $6.3 billion on European debt that soured.

The House Financial Services oversight subcommittee is to release the report of its investigation Thursday.

A spokesman for Corzine did not immediately return a telephone call seeking comment Wednesday. Corzine told Congress last December that he never intended to misuse customer money or order anyone to do so.

Legal experts say it could be difficult for the government to build a persuasive case that he did know.

Rep. Randy Neugebauer, the Texas Republican who heads the subcommittee, said in a news release that choices Corzine made as the firm's CEO "sealed MF Global's fate."

"Corzine dramatically changed MF Global's business model without fully understanding the risks associated with such a radical transformation," Neugebauer said.

The GOP lawmakers said the panel's staff interviewed more than 50 witnesses and reviewed 243,000 documents from MF Global, former employees of the firm and federal regulators.

The Republicans said Corzine acted as the firm's chief trader in practice, though not in name, and walled off his trading from the firm's review of its potential risks.

Corzine rose from the trading floor of Goldman Sachs to become the investment bank's co-chairman. He then ran successfully for the U.S. Senate in 2000 and later one term as governor of New Jersey.

Corzine took the top job at New York-based MF Global after losing a bid for re-election as governor in 2009. He stepped down as MF Global's CEO on Nov. 4, 2011, days after the firm filed for bankruptcy protection.

For months, regulators investigated whether the missing customer money was improperly used to cover MF Global's short-term needs when its trading partners lost confidence in the firm and demanded cash owed them.

Much of the missing money belonged to farmers, ranchers and other business owners who bought and sold financial contracts with MF Global to reduce their risks from the fluctuating prices of corn, wheat and other commodities.

[lordanson]

Jon, you're pitching in and doing your part in the New Jersey recovery? Aren't you? No? I mean to say that most of the state that you profess to love was blown away in the last two weeks. Don't you think that you ought to give the money that you stole to the citizens of New Jersey in their time of need? Isn't that what all Democrats do? No?

[austincoog]

This Corzine theft will never lead to any jail time & the investigation will soon be forgotten since he is a connected Obama money bundler and he will just claim incompetence, which is not criminal unless he lined his or his buddie's pockets in the process. The poor farmers that lost their crops and lands as a result of this imbecile, will be lucky to see all their monies again and Corzine might want to lay low for the rest of his miserable life or risk an untimely "accident"(like a John Deere tractor running him over)

[aghast101]

YOURREARVIEWMIRROR1: Brains 0

[YourRearViewMirror1]

Folks,

Finally, the GOPs in the House of Representatives going to create millions and millions of new good high-paying jobs in America.

[YourRearViewMirror1]

Folks,

When are the GOPs on the House of Representatives going to Investigate the great Republican Ex (Thank God) Senator Phil Gramm?

After the Senate, Phil started working as the vice chairman of the giant Swiss bank UBS's new investment banking arm in 2002 which then lost 18 Billions.

So, when is this investigation going to begin?

[leitskevin]

Silly, silly lib. Didn't the DNC control the House and the Senate just a few years ago? Couldn't they have investigated Gramm? Corzine breaks laws and loses peoples savings, and all you care about is Gramm? Is he even still alive? Silly, silly lib.

[jeffinpa1234]

It is even better than the fact the no one will be prosecuted.....we spent millions of taxpayer $'s to conclude something that already.....Corizine is a crook!

[YourRearViewMirror1]

Hey jeffinpa1234,

How much of your hard earned $$$ did you send to the Mitt Romney Presidential Campaign fund?

[wfw3536]

Don't worry nothing will happen to Corzine, as he is a good friend of Obama and Biden. I just feel sorry for the poor folks who trusted this crook.

[YourRearViewMirror1]

too bad the good friends of Mitt Romney getting nothing from the White House.

[dbuls1238]

this is such incredible crap. obama is supposed to be a man of the people, and no one at MF Global will be prosecuted for the outright theft of other people's money? oh well, they will spend the rest of eternity burning in hell..........

[WYATTBUCHANAN]

Why is Crozine not in Jail? He gave the leadership to his people to use the customers segregated money.

Or is it just because he is a huge Democrat contributor that he gets a pass?

[YourRearViewMirror1]

...and I am sure your blogs will get the Republican Party more votes in the future.

Senate: Net 3 Losts.
House: Net 5 Losts.