Corzine, who was CEO at MF Global during the collapse, said he was “stunned” to learn that client accounts could not be reconciled as the firm went down.Curiously, he hasn't invoked his 5th Amendment rights against self-incrimination. That may be a boldly stupid call on his part, considering that he's open to both criminal and civil actions in the bankruptcy of the financial firm as a result of his flawed strategies and calls. Corzine wouldn't have knowledge of the operations at MF Global as it wound down after his departure following the bankruptcy notification, but he should have knowledge of what happened in the weeks and months leading up to the bankruptcy and inability to determine where client money was.
“I simply do not know where the money is, or why the accounts have not been reconciled to date,” he said. “I do not know, for example, whether there were operational errors at MF global or elsewhere, or whether banks and counterparties have held onto funds that should rightfully have been returned to MF Global.”
Corzine said in his statement he would not invoke his Fifth Amendment rights.
“Considering the circumstances, many people in my situation would almost certainly invoke their constitituional right to remain silent — a fundamental right that exists for the purpose of protecting the innocent,” Corzine said.
“Nonetheless, as a former United States senator who recognizes the importance of congressional oversight, and recognizing my position as former chief executive officer in these terrible circumstances, I believe it’s appropriate to respond to your inquiries.”
Corzine noted, however, he had little contact with the company since his departure, and likely would not be able to explain much about what has happened during the liquidation of MF Global, which went under after Corzine directed what turned out to be disastrous investments in European debts.
That's a core responsibility of all financial firms. You are not allowed to commingle firm funds with those of the clients. Yet, that's apparently what happened, and the clients got screwed.
Corzine would love to rewrite history, and claims that he reduced MF Global's leverage from the time he took over to his departure. He then glosses over the key problem with the MF Global debacle, the pending sale in bankruptcy, and the failure to reconcile hundreds of millions of dollars of client accounts (the numbers have ranged from as low as $600 million to more than $1.2 billion.
Fact is that Corzine was claiming that the company was stable and in good financial position for a restructuring/sale in bankruptcy, when that wasn't the case. That should open him to civil and criminal liabilities.