In the wake of the MF bankruptcy, Corzine and the board were criticized in the financial press for their apparent non-awareness of the company’s condition in the immediate lead-up to the event and their apparent inabilities to manage the risk the company had assumed. MF Board at the time of bankruptcy filing:
Jon S. Corzine, Chairman and Chief Executive Officer
David P. Bolger, independent member, formerly Chicago 2016 and Aon Corporation
Eileen S. Fusco, attorney and CPA formerly for Deloitte & Touche
David Gelber, independent member, formerly ICAP plc, Citibank NA, Chemical Bank and HSBC
Martin J.G. Glynn, independent member, former CEO HSBC
Edward L. Goldberg, founder of Longview Investments, LLC, formerly Merrill Lynch
David I. Schamis, managing director at J.C. Flowers & Co. LLC, (Chris Flowers oversaw Corzine’s “blind trust” when JC held public office)
Robert S. Sloan, founder and managing partner of S3
As a US Senator Corzine used his office to get a law passed giving a tax break to a troubled Japanese bank——Christopher Flowers (a G/S crony) led the effort to takeover the bank for Corzine’s “blind trust.” Corzine said he “did not know” the law benfited him.
Another MF principal was Bradley Abelow (a G/S crony)-—appointed by Gov Corzine as NJ state Treasurer——Abelow and Corzine controlled billions of NJ’s assets.....many of which promptly disappeared, lost value, while some state agencies went bakrupt.
Treasurer Abelow and Gov Corzine formed an “investment company”....but the “financial geniuses” said they were “not aware” it is illegal for state officials to do so.
12/6
2 ex-MF Global employees sue Corzine, other execs
WASHINGTON (AP) — Two former employees of failed brokerage MF Global have sued its top executives and directors, including ex-CEO Jon Corzine, the former governor and senator from New Jersey.
The two employees say the executives lied about MF Global’s finances and encouraged workers to put their retirement savings into company stock that later plummeted.
The two are Monica Rodriguez, who was MF Global’s head of credit for the Americas, and Cyrille Guillaume, managing director of its commodities and stock division in London. Guillaume and Rodriguez are seeking class-action status for everyone who got company stock as a benefit of working for MF Global after May 2010.
A Corzine spokesman declined to comment on the suit, which was filed Monday in U.S. District Court in Manhattan.
MF Global failed after making a disastrous bet on European debt. It filed for bankruptcy court protection Oct. 31. Corzine resigned as chairman and CEO a few days later.
An estimated $1.2 billion or more may be missing from MF Global customer accounts. Regulators are investigating whether MF Global used money from customers’ accounts for its own needs as its financial condition worsened. That would violate securities rules. The FBI is investigating whether the firm violated any criminal laws.
MF Global employees were required to take part of their compensation in company stock, the suit says. A separate plan also allowed them to buy company shares at a discount. If they had known the firm’s actual financial condition, “they could have refused to buy in or insisted on compensation arrangements that were all cash,” said Jacob Zamansky, one of the attorneys representing Rodriguez and Guillaume.
“Corzine encouraged MF Global employees to invest their retirement savings and compensation in company stock, and he destroyed their wealth with his risky and outsized bets on (European) debt,” Zamansky said. “He should be held personally accountable for his actions.”
After Moody’s Investors Service downgraded MF Global’s credit rating on Oct. 24, the company’s stock dropped from $3.55 a share to $1.86 the following day. With MF Global in bankruptcy, the shares are nearly worthless; in May 2010, they traded around $8.
Several other class-action suits on behalf of MF Global shareholders also have been filed against Corzine and other top executives, and they are being consolidated by the court.
On Friday, the House Agriculture Committee voted to subpoena Corzine to testify at a hearing Thursday about his role leading MF Global. A committee spokeswoman said Corzine was served the subpoena.
Two other congressional panels announced plans to vote on subpoenas for Corzine.
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