Obama Pal John Corzine Will Likely Escape Prosecution

John Corzine, prominent Democrat, former New Jersey governor, Obama bundler, and former MF Global CEO who “lost” about $1.7 billion of investor’s money, will apparently not face charges for his malfeasance.

According to the New York Times:

A criminal investigation into the collapse of the brokerage firm MF Global and the disappearance of about $1 billion in customer money is now heading into its final stage without charges expected against any top executives.

After 10 months of stitching together evidence on the firm’s demise, criminal investigators are concluding that chaos and porous risk controls at the firm, rather than fraud, allowed the money to disappear, according to people involved in the case.

Porous controls???

From Jeff Carter at  Points and Figures.

……you could be totally cynical and say Corzine had enough money and political power to avoid prosecution where Russell Wasendorf didn’t. One poor sap tried to kill himself and will spend a lot of time in the pokey while the other will go off and start a hedge fund. It’s a political year, and Obama couldn’t afford yet another black eye by having one of his cronies go off to jail in an orange jumpsuit. Besides, if Corzine stays out of jail, just think of all the money he could raise. You think he is the only one in the grey area of finance? If you can buy your way out of jail with money and influence, there is a huge untapped market for political donations.

……After speaking with CCC lawyer James Koutoulas, and other pro traders I have no doubt that money was stolen from customer segregated funds. There is just too much smoking gun evidence. Anyone with experience in the industry would be able to sift through the legal machinations and malarky to understand the deception involved. If this were adjudicated in an Arbitration or Probable Cause Committee at an exchange, I am relatively confident that Corzine would be found guilty based on the circumstantial facts that I know.

The New York Times article describes Corzine as a fixture on the trading floor:

Corzine frequently inhabited a desk on the trading floor. One visitor to MF Global recalled that during a tour of the firm’s Manhattan headquarters, his guide suggested that if he “stuck around” he might catch the chief executive trading a few million dollars in bonds.

But a $6.3 billion wager on the European sovereign debt proved fatal. The size of the bet was enough to wipe out the firm many times over, and as questions about Europe’s health grew, a run on MF Global ensued. In the panic, the firm tapped customer money to stay afloat, which scuttled a last-minute deal to save the firm. Corzine resigned just days after the firm filed for bankruptcy.

He took money that wasn’t his to use and blew every cent on a very bad gamble; a Euro -zone debt.   When you pilfer the accounts of your customers and use it to cover bad bets, that’s a felony.

Any other Wall Street trader who pulls this kind of fraud would be pilloried as an “evil corporate thief”.

Being an Obama crony has its privileges.

 

Related post:

http://sfcmac.wordpress.com/2011/11/29/jon-corzine-pulls-a-200-million-rabbit-out-of-his-hat/

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