Forum Post: Someone Is Going To Jail For This: MF Global Caught Stealing Hundreds Of Millions From Customers?
Posted 13 years ago on Oct. 31, 2011, 9:17 p.m. EST by MonetizingDiscontent
(1257)
This content is user submitted and not an official statement
Someone Is Going To Jail For This: MF Global Caught Stealing Hundreds Of Millions From Customers?
(ZeroHedge) Say you are the head back office guy at MF Global, it is the close of trading on Thursday, the firm has already drawn down completely on its revolver, and all the resulting cash in addition to all the firm's cash at your disposal in affiliated bank accounts, up to and including petty cash, has been used to satisfy margin demands due to declining collateral value, yet the collateral calls just won't stop, and impatient voices on the other side of the phone line demand you transfer even more cash over immediately or else risk default proceedings commenced against you within minutes.
What do you do? Do you go ahead and tell your superior that the firm is broke even though the co-opted media is trumpeting every 5 minutes that "MF Global is fine", knowing full well you will be immediately fired for being the bearer of bad news, or do you assume that courtesy of your uber-boss being the former head of the Vampire Squid, and thanks to infinite moral hazard which after Lehman made sure nobody would ever fail ever again, that there is simply no way that you will be left without some miraculous rescue, if only you can last one more day, and as a result proceed to "commingle" some client funds with the firm's cash.
It turns out that at MF Global you do the latter... over and over... until you have literally stolen hundreds of millions from the firm's client accounts in hopes that the miracle rescue will come on Friday... then over the weekend... and then you realize no miracle is coming, partly because your actions have been exposed, partly because miracles only exist in fairy tales. The next thing you know, your firm is bankrupt and hundreds of clients are about to learn that all their money is gone. Poof. This is not a fictional tale. This is precisely what very likely happened at MF Global in the past 72 hours. And someone has to go to jail. That someone, if indeed this criminal act is proven to have taken place, should be none other than Jon Corzine himself.
The sad truth of just how low Wall Street has fallen comes to us courtesy of the New York Times: -Regulators Investigating MF Global-
http://dealbook.nytimes.com/2011/10/31/regulators-investigating-mf-global/?hp
= = = = = = = =
Continue Reading the rest of this article at ZeroHedge:
SEC Opens Investigation Into MF Global Insider Trading, Ignores Glaring Evidence Of Client Capital Commingling
http://www.zerohedge.com/news/sec-opens-investigation-mf-global-insider-trading-ignores-glaring-evidence-client-capital-commi
As Repeatedly Warned, Quarter End Window Dressing Key Factor In MF Global's Demise
http://www.zerohedge.com/news/repeatedly-warned-quarter-end-window-dressing-key-factor-mf-globals-demise
MF Bankruptcy Causes Biggest Foreign Bank Liquidity Scramble To 'Fed Safety' Ever, Harbinger Of Major Eurobank Stress
http://www.zerohedge.com/news/mf-bankruptcy-causes-biggest-foreign-bank-liquidity-scramble-fed-safety-ever-harbinger-major-eu
Jon Corzine Resigns From MF Global, Will Not Collect Severance
http://www.zerohedge.com/news/jon-corzine-resigns-mf-global-will-not-collect-severance
Here Comes The Politicization Of MF Global: Former Goldmanite Gensler Says MF Failure Example Of "Freedom To Fail"
http://www.zerohedge.com/news/here-comes-politicization-mf-global-former-goldmanite-gensler-says-mf-failure-example-freedom-f
We find it supremely ironic that one former Goldmanite, in this case the CFTC's Gary Gensler, takes credit (doing the people's work this time?) for allowing the failure of what is now a documented criminal enterprise, MF Global, run by another former Goldmanite, Jon Corzine, and claiming this was nothing less than an example of "Freedom To Fail".
The NYT quotes Gensler: "This was an example of a financial institution having the freedom to fail,” he said in response to questioning from Senator Carl Levin, the Michigan Democrat who chairs the Permanent Subcommittee on Investigations. “I don’t think there’s any taxpayer money behind this.”"
No, Gary, there is just client money behind this. Anywhere between $700 million and $1.5 billion. Money that was stolen, and had MF global been bailed out, you, the CFTC and the US Government would have been complicit in a prima facie felony. So please - no need for the pathetic pandering to the lowest common denominator that only years of Goldman tenure can hone to this level of perfection.
The only question is whether the CFTC, together with that other corrupt regulator which oddly enough is not yet run by a third Goldman alum, has the "freedom to jail."
Continue Reading the rest of this article Here:
http://www.zerohedge.com/news/here-comes-politicization-mf-global-former-goldmanite-gensler-says-mf-failure-example-freedom-f
((UPDATE)) Lawyer Tells Bankruptcy Judge: All MF Global Funds Accounted For, Held by Brokerage
http://dailybail.com/home/lawyer-tells-bankruptcy-judge-all-mf-global-funds-accounted.html
We'll just have to wait and see now.
MF Global Admits Using Client Money
http://dailybail.com/home/breaking-mf-global-admits-using-client-money.html
This is not looking good for former New Jersey Senator and Governor, and previously Goldman Sachs CEO Jon Corzine. More than $700 million of supposedly safeguarded client funds were stolen by MF Global to support besieged trading positions. Jon Corzine should go to prison. If Corzine escapes without a Federal ID number and associated orange jumpsuit due to fundraising ties with Obama and Eric Holder, then the game is over.
Regulators Investigating MF Global For $700 Million In Missing Client Funds - Was It Stolen By Management?
http://dailybail.com/home/regulators-investigating-mf-global-for-700-million-in-missin.html
Liquidity Scramble Begins In MF Commingling Aftermath
http://www.zerohedge.com/news/liquidity-scramble-begins-mf-commingling-aftermath
(ZeroHedge) When sharing our perspective last night on why the alleged MF Global crime of commingling client capital with the firm's deficiency capital we asked, "What happens next? Why customers at all other brokerages, all other exchanges, afraid that their money will suffer the same fate as MF, even if they transact with perfect solvent clearers and agents, will proceed to pull their money, as they know they have nobody to trust but their own prudent and forward looking actions. Which in turn will start the kind of liquidity drain that killed not only Lehman, but froze money markets, and with that brought the complete capital markets to a standstill, only to be thawed after the Fed pledged multiples of the US GDP to rescue Wall Street in October of 2008."
Sure enough, here it comes. "Reports of short falls of client money ... if true would be a disaster for all the smaller brokers and banks as nobody will trust them anymore," one London trader said. Reuters continues "MF Global filed for bankruptcy protection on Monday, putting a sudden end to Corzine's drive to transform the more than 200-year old MF Global into a mini Goldman by taking on more risky bets on euro zone sovereign debt. In Australia, trading in grain futures and options was suspended by bourse operator ASX Ltd , prompting concerns about the integrity of the country's agricultural futures market. "We're sitting out here with risk that we can't cover," said Jonathan Barratt, head of Sydney-based Commodity Broking Services. MF Global was one of the largest participants in the country's agricultural futures market. And it is all only going to get worse as the liquidity outflow avalanche is realized, following the market's most recent distraction with Europe.
Continue Reading at:
http://www.zerohedge.com/news/liquidity-scramble-begins-mf-commingling-aftermath
= = = = = = = =
Clients scramble for money after MF Global shock
http://www.reuters.com/article/2011/11/01/mfglobal-exchanges-idUSL5E7M12NY20111101
= = = = = = = =
woa
Heart Stopping News: MF Global did Not Separate Customer Accounts:
http://www.reuters.com/article/2011/11/01/us-cme-mf-idUSTRE7A02WJ20111101
(Reuters) - MF Global Holdings Ltd, the futures broker that filed for bankruptcy protection on Monday, did not separate its customers' accounts from the firm's funds as required by law, its main exchange regulator said on Tuesday.
"CME has determined MF Global is not in compliance with Commodity Futures Trading Commission and CME customer segregation requirements," CME Group Inc Chief Executive Craig Donohue said. Futures brokers must keep customer accounts separate from each other and from the firm's own money.
Donohue said CME is looking into exactly what happened at MF Global.
= = = = = = = =
Heart Stopping News
http://maxkeiser.com/2011/11/01/heart-stopping-news/
= = = = = = = =
(Max Keiser) "Greece is doing right thing, as I indicated in this (Video) interview. The global banking system needs a reset."
http://maxkeiser.com/2011/11/01/greece-is-doing-right-thing-as-i-indicated-in-this-interview-the-global-banking-system-needs-a-reset/
Financial terrorists gong to jail? I'm still waiting for someone to got to jail for the 2008 Financial Terrorism..Let's hope our "Just for Us" Justice system smartens up and holds these criminals accountable..
Federal regulators have discovered that hundreds of millions of dollars in customer money have gone missing from MF Global in recent days
http://maxkeiser.com/2011/11/01/federal-regulators-have-discovered-that-hundreds-of-millions-of-dollars-in-customer-money-have-gone-missing-from-mf-global-in-recent-days/
= = = = = = = =
Regulators Investigate MF Global for Missing Customer Money; MF Global Goes Bankrupt Before Making 1st Interest Payment; Corzine’s Achievement Sheet
http://globaleconomicanalysis.blogspot.com/2011/11/regulators-investigate-mf-global-for.html?utm_source=feedburner&utm_medium=twitter&utm_campaign=Feed%3A+MishsGlobalEconomicTrendAnalysis+%28Mish%27s+Global+Economic+Trend+Analysis%29
= = = = = = = = =
MF Global is first big US victim of Europe crisis
http://finance.yahoo.com/news/MF-Global-is-first-big-US-apf-590521534.html?x=0&sec=topStories&pos=3&asset=&ccode=&cmtnav=/mwphucmtgetnojspage/headcontent/main/590521534/date/asc/1/0
= = = = = = = =
Hi Monetizing, Another good post. Life as usual on Wall Street. Best Regards, Nevada
That sounds just like madoff
Lots of Background links on the subject of MF Global, on an earlier post at:
http://occupywallst.org/forum/how-former-goldman-ceo-and-nj-governor-jon-corzine/#comment-251672
-Corzine's Achievement Sheet-
http://globaleconomicanalysis.blogspot.com/2011/11/regulators-investigate-mf-global-for.html
(1) After being forced out as CEO of Goldman Sachs, Corzine spent a record $62 million of his own money on a US Senate campaign and won. The prior record was $28 million.
(2) During the senate campaign, Corzine refused to release his income tax return records citing a confidentiality agreement with Goldman Sachs.
(3) In 2000, Corzine denied having paid off ministers, when in fact the foundation controlled by him and his wife had paid one influential church $25,000.
(4) While Senator, Corzine decided he would rather be governor of New Jersey and spent $38 million buying the governorship.
(5) As governor, Corzine spent some $200,000 of his own money on advertisements to promote a referendum on the 2007 New Jersey ballot to borrow $450 million to fund stem cell research. The referendum was rejected although $270 million had previously been approved to build stem cell research centers.
(6) Corzine, in attempting to pass the 2007 fiscal year budget, said that he would not accept a budget that did not include a hike in the sales tax from 6% to 7%.
(7) After the legislature failed to pass Corzine's budget by the deadline of July 1, 2006, he signed an executive order that immediately closed down all non-essential state government services.
(8) Corzine lost his reelection bid to Republican Chris Christie. It takes rare talent for Democrats to lose in New Jersey.
(9) In 2010 Corzine was named CEO of MF Global and used 40-1 leverage on foolish bets on European bonds driving the company into bankruptcy.
(10) MF Global is the first company to go bankrupt in three years while still rated investment grade by rating agency S&P. The previous company was Washington Mutual.
(11) MF Global is one of very few companies ever to go bankrupt before making its first bond payment
VIDEO - Bill Black At Occupy Wall Street Discusses Putting Criminal Bankers In Jail
http://www.youtube.com/watch?feature=player_embedded&v=4XJe7O-3QBc