Jon Corzine steps down as investigations mount
This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.
As the scrutiny of MF Global’s bankruptcy continues to mount, the trading firm’s chief executive, Jon Corzine, stepped down and reportedly hired a criminal defense attorney.
Corzine, who had previously served as a U.S. senator and as the chief executive of Goldman Sachs, announced the resignation Friday morning, five days after MF Global filed for bankruptcy.
In a statement, Corzine said: ‘I feel great sadness for what has transpired at MF Global and the impact it has had on the firm’s clients, employees and many others.’
Corzine said that he would not seek any severance payments as he steps away from the company.
The move is the latest stage in Corzine’s descent from the loftiest heights of power. Corzine took over MF Global last year after losing a bid to be reelected as New Jersey governor. He promised to help MF Global grow by making bigger bets with the firm’s own money.
That strategy backfired after the firm made a series of large bets on the sovereign debt of struggling European countries.
Now, a growing list of regulators and prosecutors are probing MF Global’s actions as it encountered difficulty. Friday morning, the New York Post reported that the U.S. attorney in Manhattan, Preet Bharara, is taking a look at whether the company mishandled customer funds. This is a subject the FBI has already been reported to be looking at.
To help deal with these inquiries, Corzine hired a criminal defense attorney, Andrew Levander of Dechert LLP, according to the Wall Street Journal.
On the regulatory side, it seems as though every lawyer at the Securities and Exchange Commission could get drawn into looking at some potential misdeed related to the firm. The SEC added to its workload when it began looking into possible insider trading in MF Global’s bonds during its last days in operation, Bloomberg reports. And the Wall Street Journal gave it yet another potential topic Friday morning when it reported that MF Global may have taken steps to hide from investors its true levels of risk.
Given all these problems, Corzine’s statement in stepping down -- and the lack of any mention of remorse -- is coming under fire from industry watchers like Reuters columnist Felix Salmon:
I’m sure you’re sad — that often happens, when you become the living embodiment of the destructive greed of the 1% and a hate figure for millions. But are you sorry? Or are you going to pull a Dick Fuld and live in denial, convinced “until they put me in the ground” that you’re a victim rather than a perpetrator?
This kind of thing is why there’s so much anger aimed at the 1%. Chances are, Corzine will never be prosecuted, let alone convicted, and that he’ll enjoy the comfortable retirement of a centimillionaire for decades to come. He deserves much worse. But right now, when it matters, he can’t even bring himself to say he’s sorry.
-- Nathaniel Popper