There they stood, all three of them, being sworn in before the Senate Agriculture Committee. They were being questioned about the whereabouts of some $175 million that had gone missing as MF Global was going belly-up on their watch.
It could have been a group picture of MF Global's executive board -- its former CEO (chief executive officer), its former COO (chief operating officer) and former CFO (chief financial officer). Each had a card in front of him bearing his name as all three raised their right hands and took the oath:
Hon. Corzine
Mr. Abelow
Mr. Steenkamp
The last two rated only a Mr., while Jon Corzine, a former U.S. senator, was identified as Honorable. (Members of Congress may leave office, but not their titles behind.) These three corporate execs were being called to answer some questions under oath, mainly about who decided to shift money in customers' supposedly safely segregrated accounts at MF Global to parts unknown.
To use an inexact but all too relevant metaphor, it was as if your friendly neighborhood bank, confronted by the prospect of going broke, had decided to break open the customers' safety-deposit boxes, mix the money with its own assets in one big pile, and let the creditors scramble through it for theirs.
The photo of these three could have been labeled See No Money, Hear No Money, Speak No Money. Not a one had any idea where the dough had gone. To translate their testimony from executalk into the familiar vernacular used in so many official hearings, not to mention the "Godfather" movies: "Money? We don't know nuttin' about no money."
The same theme has run through past congressional investigations into everything from the low aspects of high finance to the mob's influence on labor unions. How little some things have changed since John L. McClellan's time.
In the wake of MF Global's crash, Jon Corzine did his best to sound innocent. The former senator, former governor, former CEO of Goldman Sachs (the really powerful position), but still Honorable told the committee: "I never gave any instruction to anyone at MF Global to misuse customer funds."
If the Hon. Corzine wasn't perjuring himself in this testimony, then it amounted to a confession of executive incompetence on an Obama-sized scale, though compared to MF Global, the Solyndra scandal was tiny potatoes. Maybe this ought to be called the Case of the Executive Who Didn't Execute. The curious public is expected to believe he was just hanging around MF Global when all this transpired outside its high-rise offices.
The other two executives on oath backed up Hon. Corzine's testimony, but the case is scarcely closed despite these claims of innocence in triplicate. It seems other testimony didn't quite jibe with Jon Corzine's: "The only thing I can tell you is that MF Global transferred customer money to its broker dealer, and that Mr. Corzine was aware of the loans being made from segregated accounts." --CEO Terrence Duffy of CME Global, the giant commodities clearing house.
There's doubtless more to come in this continuing story. Stay tuned. As many doubtless will. Maybe that's because some of Mr. Corzine's protestations of innocence had the ring of Clinton clauses. As he testified at one point, "I never intended to break any rules." He never intended to break any rules. Which is not quite the same as not having broken them, is it?
The $175 million at issue in these particular hearings, for more are surely to come, is but part of the $2.1 billion said to be still mising from customers' accounts still unaccounted for six weeks after MF Global's collapse. The estimate keeps growing, and keeps growing harder to pin down.
A Wall Street titan may fail in a single day, but the investigations continue forever. In the matter of MF Global and the missing money, the tell-all memoir hasn't even gone to press yet. But some of us can never get enough of such stories. Maybe it's the vicarious thrill, since reading about the fall of Big Money may be about as close as we'll ever get to it, which is just as well. Even carrying around a paycheck makes us nervous. But we can read ourselves to sleep reliving the South Sea Island Bubble or the Swedish Match King's financial manipulations before his mysterious end. Now the Saga of MF Global enters not just politics but history and legend.
The missing millions may be a small sum by Jon Corzine's generous standards, but there are those, mainly farmers and ranchers, who were much attached to it. For they had invested the money as a hedge to insure against losses. Now it's been lost. And no one seems to know just where the millions went. That the money belongs, or once belonged, to American farmers and ranchers is why this not-so-little matter fell under the jurisdiction of the Senate Agriculture Committee.
The chairman of the Senate committee, Michigan's Debbie Stabenow, bless her heart, sounded stumped. "This isn't the Dark Ages," she observed. "MF Global didn't keep their books with feather quills and dusty ledgers." Maybe if it had, it might be easier to trace the money now. Instead, the millions seem to have disappeared into the computerized ether.
Bob Cratchit, the much abused clerk at Scrooge and Marley's counting-house, surely would not have lost track of such a sum, and it's hard to imagine E. Scrooge not knowing where every penny of it was, probably in a featherbed. And as every calligrapher knows, there is much to be said for quill pens, or at least for the integrity of many who used them.
After all, the Declaration of Independence wasn't signed by an auto-pen. And the speeches at the Constitutional Convention weren't delivered with the help of a TelePrompTer. They weren't even videotaped. But we moderns tend to confuse the advance of a civilization with the advance of its machines. In some respects, a return to the past would be real progress.
Sen. Stabenow has committed the all too common error of condescending to medieval scribes, who might have been considerably amused by the result of all our electronic bookkeeping, which in MF Global's case can't seem to locate a mere $1.2 billion. Maybe it's in the petty cash drawer. Could it have rolled under the bed? Have they looked under the rug?
Or maybe, since nobody in particular seems to have decided to transfer the money, it just got up and walked off on its own, having decided it was time to tour Europe.
Tell us another.
And before this investigation is concluded, doubtless someone will.
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