There once was a Wall Street firm named MF Global. I'm not sure what they did to make money, but they hired a guy named Jon Corzine, a Democrat, to help them do it.
Jon Corzine had once been the head of Goldman Sachs. He was fired from his job while he was on a ski trip with his family by Hank Paulson who was also a Goldman Sachsian, and later became the Secretary of the Treasury who invented the whole TARP thing.
Don't think that Mr. Corzine and his family had to live out of an A&P grocery cart under the Manhattan Bridge. He made $400 million when Paulson took Goldman public.
Wall Street people operate in a different universe than the rest of us.
Corzine, not satisfied with having been one of what was called a "Master of the Universe" by running one of the too-big-to-fail Wall Street firms, went on to run for, and be elected to, the United States Senate from New Jersey in 2000 as a Democrat.
Talk about Masters of the Universe.
In the wake of the Enron scandal (among others) Democrat Jon Corzine was a big, BIG supporter of what became known as Sarbanes-Oxley which, among other things, forced CEOs to take personal (and criminal) responsibility for reporting what was going on in their companies.
This was to prevent investors from losing lots and lots of money due to internal shenanigans by executives at companies who had only the most passing interest in protecting their stockholders' and investors' money.
Corzine, back in Master of the Universe mode, decided that being one of 100 Senators was not as cool as being one of 50 Governors so in 2005 he ran for, and was elected as, Governor of New Jersey. As a Democrat.
Four years later, in 2009 he ran for re-election but was beaten by Republican Chris Christie of Governor Chris Christie fame.
Not one to be put out to pasture, Corzine got himself hired by a firm named MF Global which was a "multinational futures broker and bond dealer."
I do not pretend to know that that means because my major financial transactions are limited to things called an ATM and a PIN.
MF Global bet heavily on what is known as the sovereign debt of countries in Europe named, among others, Greece and Italy. For those who are into these things, Reuters described it as MF Global having "entered into repurchase and reverse repurchase transactions to maturity, which are accounted for as sales."
Corzine, a Democrat, who feigned outrage when Enron went down in flames, was the CEO of MF Global which went broke and became the eighth largest bankruptcy in US history.
The weekend that MF Global was going down the Wall Street toilet, the Democrat Corzine tried to sell the company. The company with which MF Global was attempting to make a deal couldn't find about $1.2 BILLION dollars that were supposed to be in customers' accounts and so backed out of the deal.
It seems that in order to cover its bad bets, MF Global (headed by former Democratic Senator and Governor Jon Corzine) took money from customers' accounts who had no knowledge of this activity and had no interest the bets' successes or failures.
This was, as I understand it, like the head of your branch bank taking money out of your checking account and betting it on a camel running in a race in Dubai.
MF Global was declared bankrupt. Trading in its shares were halted.
Remember: Corzine. Democrat. Enron. Sarbanes-Oxley. CEO Responsibility for his (or her) firm.
Yesterday Jon Corzine was hauled in front of a Congressional Committee to explain just how he could have allowed money in customers' accounts to have been used as collateral against "repurchase and reverse repurchase transactions to maturity."
He didn't know. He didn't know what happened to the money. He barely knew what the term "Wall Street" meant or where New York was located.
I have no idea whether Jon Corzine will be found criminally liable for what went on at the firm he headed. I DO know that when he was a holier-than-thou member of the United States Senate he was an outspoken advocate of exactly that.
My guess is the customers of MF Global will be lucky to get a fraction of their money back.
I know this demonstrates my ignorance of big-time finance, but I'm having a really tough time finding much difference between Jon Corzine, Democrat; and Bernie Madoff, crook.
Join the conversation as a VIP Member