According to an email obtained by congressional investigators, MF Global’s CEO Jon Corzine ordered $200 million shifted from a customer account to one of the firm’s bank accounts overseas to cover an overdraft. The email noted that the transfer was made “per JC’s direct instructions.”
A House Financial Services subcommittee just released the memo. Last December, Corzine told the subcommittee: “I did not instruct anyone to lend customer funds to MF Global or any of its affiliates.” Corzine also told the subcommittee he didn’t know about “the use of customer funds on any loan or transfer.”
Corzine told a Senate panel two days earlier: “I never gave any instruction to anyone at MF Global to misuse customer funds.”
Client money is required by law to be held separately from a brokerage firm’s cash to protect investors in case a firm fails.
No one has been charged in the MF Global case.