• 06 Nov 2013 at 4:42 PM

Jon Corzine Didn’t Take MF Global Customer Money

He just hid it for a while. You can have it back now. All of it, much to everyone’s surprise.

James W. Giddens, the trustee unwinding MF Global’s brokerage unit, recovered large swathes of the money and gradually disbursed it to clients. But Mr. Giddens, still facing a roughly $230 million gap, recently petitioned Judge Martin Glenn to free up remaining funds from MF Global Incorporated’s general estate.

Judge Glenn agreed, potentially allowing Mr. Giddens to make customers whole by the end of the year….

“In the opening moments of the liquidation proceeding, it seemed inconceivable that we would even consider the possibility of 100 percent return of property owed to former customers of MF Global,” Mr. Giddens said to Judge Glenn before he ruled.

Judge Glenn echoed the observation, noting the sudden turn in fortunes for customers. “At the outset of the case, nobody thought that customers would recover everything they lost,” he said at the hearing.

Now, if you would, please stop suing him.

Jon S. Corzine wants a judge to dismiss the amended lawsuit against him and other former MF Global Holdings Ltd. executives, saying it is filled with “disparaging characterizations” of old facts….

MF Global’s litigation trustee in September filed a suit saying the executives acted “recklessly” and with “gross negligence” by using customer funds to cover bets on foreign debt that had gone bad. Mr. Tavakoli, chief executive of investment firm EagleRock Capital Management, said Mr. Corzine was the mastermind of a “scheme” to buy the debt with borrowed money and artificially inflate MF Global’s revenue.

In seeking dismissal, lawyers for Mr. Corzine and the others said that because they didn’t intend for the customer funds to be misused, they didn’t act in bad faith. They also said the positive revenue generated by their “repurchase-to-maturity” financing transactions weren’t artificial, but rather were part of the company’s new business plan.

MF Global Customers Will Recover All They Lost [DealBook]
Corzine Seeks Dismissal of MF Global Suit [WSJ]

Comments (3)

  1. Posted by Bernie Madoff | November 6, 2013 at 4:45 PM

    My hiring hookers and finessing the statements to improve returns wasn't artificial, it was part of BMIS' new business plan!

    Let me out now, please?

  2. Posted by Walter Mitty | November 6, 2013 at 4:52 PM

    I didn't intend to lose at the horse races, the money I took from the bank safe, so I didn't act in bad faith.

  3. Posted by B Iteme | November 7, 2013 at 12:55 PM

    Oh, that's Corzine. I thought he was just the male model for the Smith Brother's cough drop box.