Political ties win Corzine respect in Congress

Reuters News
Posted: Dec 09, 2011 6:33 PM
Political ties win Corzine respect in Congress

By Alexandra Alper

WASHINGTON (Reuters) - A day after Jon Corzine got politely grilled by lawmakers over the collapse of futures brokerage MF Global Holdings Ltd, questions remain over the role his deep political ties and generous donations will play as he gears up for another round of congressional scrutiny.

Corzine, who resigned as chief of MF Global days after the firm filed for bankruptcy on October 31, has been a prominent fundraiser and personal contributor to Democrats.

He personally donated $69,300 to Democratic causes this year alone, including $15,000 to the Democratic Congressional Campaign Committee, according to data from the Center for Responsive Politics.

Corzine - a former U.S. senator, New Jersey governor, and Goldman Sachs Group Inc chief executive - has been under the gun since revelations the firm bet $6.3 billion on European sovereign debt spooked investors and pushed the firm into bankruptcy.

An ensuing search for hundreds of millions of dollars in customer funds attracted the attention of the FBI, federal prosecutors and lawmakers seeking answers for jilted farmers.

The House Agriculture Committee became on Thursday the first in a series of committees to question him in what many saw as a relatively friendly manner.

Corzine faces two more panels next week: the Senate Agriculture Committee on Tuesday and a House Financial Services subcommittee on Thursday.

Corzine's financial largesse is likely to at least be in the back of many people's minds during these hearings," said Michael Beckel, a spokesman for the Center for Responsive Politics.

A spokesman for Corzine was not immediately available for comment.

At Thursday's hearing, lawmakers thanked Corzine - whose name placard read "Honorable" - for not invoking his right to avoid self-incrimination under the Fifth Amendment of the U.S. Constitution.

He got gentler treatment than his former Goldman Sachs colleague, Commodity Futures Trading Commission Chairman Gary Gensler, who has been skewered by lawmakers for stepping aside from a probe into MF Global.

But Corzine was still criticized for not giving a straight answer on whether he directed the transfer of customer funds to firm accounts.

"Throughout this hearing I can count the times you used the words 'never intend,' 'not to my knowledge,' 'not to my recollection,' 'never intended to.' And I understand the position that you're in, but Mr. Corzine, we've got to find that money," said Democratic Representative David Scott.

Corzine has been a major fundraiser for President Barack Obama, having donated the maximum of $5,000 that an individual can give for a presidential campaign, according to campaign finance records.

He also held a lavish $35,800-a-head fundraising dinner for Obama at his home in April and raised or "bundled" donations of at least $500,000 so far for Obama's 2012 re-election effort.

An Obama campaign official, speaking on condition of anonymity, said the donations received from Corzine as an individual would be returned if civil or criminal charges are brought against him.

Bill Galston, a senior fellow at the Brookings Institution, says the respectful tone at Thursday's hearing was likely due in part to Corzine's "status as a former member of the club." Corzine was a U.S. senator from 2001-2006.

The tone reflects "some baseline respect for someone who has been through it in the private sector and the public sector and who has made contributions" to society, said Galston.

"This is not a lifelong scoundrel and he is not a serial flouter of laws."

(Reporting by Alexandra Alper; editing by Andre Grenon)