James Koutoulas crushes it on CNBC. He has the facts on his side. First, Koutoulas isn’t some run of the mill attorney for hire. He runs a CTA in the futures industry called Typhon Capital. Second, he didn’t campaign for the case. He saw a wrong, and plenty of disenfranchised customers. He organized the Commodity Customer Coalition and did something about it.
Did Corzine and MF Global commit fraud? We won’t know until they are charged and the case tried. What’s clear is that there is plenty of circumstantial evidence to cause experienced commodity players to think Corzine did commit fraud. The PFG case and MF Global case are almost exactly alike.
The fallout behind this is that most people are leaving very little trading capital in their accounts. Eventually, clearing firms will consolidate even more and the business harmed as competition is concentrated.
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Second, what’s really clear is that there is political reasons for Obama in an election year to avoid prosecuting one of his cronies. Obama wouldn’t have to give the order. His minions would know their marching orders before they were given. The Justice Department holds the key to going forward on the case. It’s entirely possible that they didn’t understand the case. But there are plenty of expert witnesses they could have called to enlighten a mystified jury. Further, Wall Street has a habit of protecting its own, even when they are demons. One has to dive to the depths of Bernie Madoff to get discarded.
Corzine is Wall Street. Russell Wasendorf was not. Wall Street must fear that a Corzine trial would turn into a proxy of everything over the last four years. They don’t want to see that happen, even though this go round they mostly are against Obama. Having Corzine prosecuted could be worse for them than enduring four more years of a feckless President.
How much you want to bet that Corzine gets a pardon if Obama loses to Romney in November?