Magazine article American Banker

House Report Says Corzine, Regulators to Blame for MF Global Collapse

Magazine article American Banker

House Report Says Corzine, Regulators to Blame for MF Global Collapse

Article excerpt

Byline: Victoria Finkle

WASHINGTON a House Republicans issued a report Thursday that blames the failure of brokerage firm MF Global on former Sen. Jon Corzine's leadership of the firm, adding that a lack of coordination among regulators also played a role.

The report by the House Financial Services Committee's subcommittee on oversight and investigations describes an "authoritarian atmosphere" created by Corzine and says that the former lawmaker and governor insulated his trades from the standard review process. The company also failed to disclose the extent of its risk-taking, including its total European bond holdings, the study finds. Lawmakers did not weigh in on whether Corzine should face criminal charges.

The staff report also charges that the Securities and Exchange Commission and the Commodity Futures Trading Commission failed to share "critical" information with each other leading up to the firm's bankruptcy.

"Despite the promise of Dodd-Frank that regulators would work together, what the subcommittee's investigation found is that there was no meaningful coordination among the federal regulators who were responsible for the supervision of MF Global," said Chairman Spencer Bachus, R-Ala., at a press conference. "Federal regulators failed to share critical information about MF Global with one another, and this left each regulator with an incomplete understanding of the company's financial health."

As such, the report suggests that Congress explore merging the two agencies. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.