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MF Global Trustee Estimates Shortfall Could Be $1.2 Billion+ (double original estimates)
NYTimes ^

Posted on 11/21/2011 8:50:41 AM PST by quesney

The court-appointed trustee overseeing the liquidation of MF Global’s brokerage now estimates that the shortfall in the firm’s customer funds could be more than $1.2 billion, double previous estimates.

(Excerpt) Read more at dealbook.nytimes.com ...


TOPICS: Business/Economy; Crime/Corruption; News/Current Events
KEYWORDS: corzine; cultureofcorruption; joncorzine; mf; mfgh; mfglobal; wallstreet; wallstreetbashing
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Good grief. How do you "lose" $1.2 BILLION?

I'm guessing Wall Street has also lost the average retail investor's trust for at least a generation.

1 posted on 11/21/2011 8:50:44 AM PST by quesney
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To: quesney

Good grief. How do you “lose” $1.2 BILLION?


Off shore bank accounts.


2 posted on 11/21/2011 8:52:08 AM PST by unkus (Silence Is Consent)
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To: quesney

That’ll leave a mark!.


3 posted on 11/21/2011 8:53:50 AM PST by meatloaf (It's time to push back against out of control government.)
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To: unkus

You “trust” your hard earned money to Jon Corzine, our next Treasury Secretary!


4 posted on 11/21/2011 8:53:59 AM PST by vette6387 (Enough Already!)
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To: quesney

If segregated funds aren’t segregated, major jail time is called for. Even following orders on this should be severely punished.

There is an investors protector insurance group, but as far as I know, that’s for securities. I don’t know if there’s any protection for commodity accounts once the rules of conduct and the exchange oversight have been breached.


5 posted on 11/21/2011 8:56:19 AM PST by Pearls Before Swine
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To: quesney

Time to invest in Orange Jumpsuit, handcuff and leg chain manufacturers.


6 posted on 11/21/2011 8:58:01 AM PST by Kartographer (".. we mutually pledge to each other our lives, our fortunes, and our sacred honor.")
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To: vette6387

You “trust” your hard earned money to Jon Corzine, our next Treasury Secretary!


I started to laugh at this before I remembered that in our today’s USA — Upside-Down States of America — something like this could really happen. We are in the Twilight Zone, where even cash in a brokerage account isn’t safe.


7 posted on 11/21/2011 8:58:29 AM PST by quesney
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To: Pearls Before Swine

Off the top of my head the CME’s version of SIPC needs to make this good; hope they didn’t let their insurance lapse . . .


8 posted on 11/21/2011 8:59:25 AM PST by LRoggy (Peter's Son's Business)
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To: unkus
Um....you don't lose $1.2 Billion. $1.2 Billion can be stolen however.

What I'm intrigued by is the NY Times covering this. Think of it, the NY Times covering something like this of MF Global, a company which Jon Corzine headed until recently?

Pinch me, I must be dreaming.

9 posted on 11/21/2011 8:59:38 AM PST by Rational Thought
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To: quesney
"Good grief. How do you "lose" $1.2 BILLION?"

by stealing money from customer's segregated accounts to make super high risk investments. They bet wrong and lost the money they converted from their customers in the market.

10 posted on 11/21/2011 9:00:04 AM PST by circlecity
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To: quesney

“Good grief. How do you “lose” $1.2 BILLION?”

You don’t lose it, of course. You steal it. In essence, this appears to be plain old theft. You simply take funds from customer accounts and use them (and lose them) in your business. As of now, Corzine appears to be a common thief who wormed his way into the big leagues.

All of that said, it is still early; so maybe there is some other explanation. For the sake of the account owners, I hope so.


11 posted on 11/21/2011 9:00:17 AM PST by olrtex
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To: Pearls Before Swine

“There is an investors protector insurance group, but as far as I know, that’s for securities. I don’t know if there’s any protection for commodity accounts once the rules of conduct and the exchange oversight have been breached.”

I’ve heard that commodites/options/futures accounts *are not* protected. MF’s clients are F’d.


12 posted on 11/21/2011 9:00:18 AM PST by quesney
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To: quesney
"Good grief. How do you "lose" $1.2 BILLION?"

Security Sergeant Montone: "Nelson, we're talking about nuclear detonators here. You don't just "lose" them and then "find" them again. You lose your *comb* and then find it, but not nuclear detonators. I want to know *when* and *where* they were found. You get my drift?"
From the movie 'Outland' (1981)
13 posted on 11/21/2011 9:01:14 AM PST by Kartographer (".. we mutually pledge to each other our lives, our fortunes, and our sacred honor.")
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To: quesney

Culture of Corruption


14 posted on 11/21/2011 9:01:18 AM PST by Hoodat (Because they do not change, Therefore they do not fear God. -Psalm 55:19-)
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To: quesney
You trust your money on wall street, if you do, buy a fish bowl and drop a “BB” into it, stand back and look at amazement at a graphic display of your brain inside your skull.
15 posted on 11/21/2011 9:01:26 AM PST by org.whodat (Just another heartless American, hated by "AMNESTY" Perry and his fellow demorats.)
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To: quesney

Incredible no one goes to jail over this stuff.


16 posted on 11/21/2011 9:01:27 AM PST by rokkitapps ( Hearings on healthcare waivers NOW! (If you agree make this your tagline))
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To: quesney

http://barnhardt.biz/

Read Ann Barnhardt’s Farewell to the Markets message

(Also check out her Youtube vids- she rocks!)


17 posted on 11/21/2011 9:01:40 AM PST by silverleaf (common sense is not so common- voltaire)
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To: quesney

Put Corzinne in a cell next to Bernie Madoff


18 posted on 11/21/2011 9:02:17 AM PST by Mr. K (Physically unable to proofreed <--- oops, see?)
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To: unkus; quesney

-——How do you “lose” $1.2 BILLION-——

The article says is was lost in trading.

The loss is the gambler’s equivalent of trying to make up losses at the roulette table with the kid’s college money


19 posted on 11/21/2011 9:02:17 AM PST by bert (K.E. N.P. +12 ..... Crucifixion is coming)
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To: Pearls Before Swine
There is insurance to protect cash balances..but I think it's voided when the firm's principal's..who took out the coverage, were the same ones who committed the fraud.

It's similar to fire insurance..if you take our coverage, then burn your house down, it's not in effect..

This was a major fraud..all the cash balances were removed and transferred. It takes several clerks..back office personnel..to do this..Corzine ordered it to be done, but the ones who actually did the transfers knew they were breaking the law..and should have refused to comply, AND reported it to the authorities..They probably went along, because they were told by Corzine, and he convinced them, that it would all be put back in a few days, no one would know, and it would save the firm, and their jobs..

They're now talking to the feds,a nd attemptig to work out plea bargains for themselves. The Feds wan direct testimony linking Corzine to the criminal acts..

20 posted on 11/21/2011 9:03:03 AM PST by ken5050
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To: Rational Thought

Most of the coverage seems to try to delete or minimize the role of the CEO Corzine. They also seem to forget he is a democratic politician and a candidate for Sec Treasury.


21 posted on 11/21/2011 9:03:18 AM PST by Oldexpat
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To: bert

I dont think they “lost” all of this- It is nice and safe in Obama’s campaign fund.


22 posted on 11/21/2011 9:03:48 AM PST by Mr. K (Physically unable to proofreed <--- oops, see?)
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To: quesney

Umm, yeah, like when they floated the name of Jamie Gorelick as possible obama FBI chief


23 posted on 11/21/2011 9:04:11 AM PST by silverleaf (common sense is not so common- voltaire)
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To: Hoodat
I posted this on another thread, but I like to ask it here too. I have always been fascinated by the fact that real life so often on parts of fiction.
So recently I was discussing with a fellow Star Trek fan how much today’s business practices of so many of are largest corporations and too big to fail seem to adhere to The Ferengi Rules Of Acquisition from Star Trek. Here’s a few you be the judge:

5. If you can’t break a contract, bend it
13. Anything worth doing is worth doing for money
14. Anything stolen is pure profit
16. A deal is a deal ... until a better one comes along
23. Never take the last coin, but be sure to get the rest
24. Never ask when you can take
26. The vast majority of the rich in this galaxy did not inherit their wealth; they stole it
28. Morality is always defined by those in power
29. When someone says “It’s not the money,” they’re lying
37. You can always buy back a lost reputation
46. Labor camps are full of people who trusted the wrong person
47. Don’t trust a man wearing a better suit than your own.
51. Never admit a mistake if there’s someone else to blame
53. Sell first; ask questions later
61. Never buy what can be stolen
70. Get the money first, then let the buyers worry about collecting the merchandise
80. If it works, sell it. If it works well, sell it for more. If it doesn’t work, quadruple the price and sell it as an antique (or a derivative)
81. There’s nothing more dangerous than an honest businessman
208. Sometimes the only thing more dangerous than a question is the answer.

24 posted on 11/21/2011 9:05:47 AM PST by Kartographer (".. we mutually pledge to each other our lives, our fortunes, and our sacred honor.")
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To: quesney

DNC Swiss accounts.


25 posted on 11/21/2011 9:07:55 AM PST by Terry Mross (I'll only vote for a second party)
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To: Kartographer

I’m thinking more like...tar and feathers...


26 posted on 11/21/2011 9:09:26 AM PST by goodnesswins (My Kid/Grandkids are NOT your ATM, liberals! (Sarah Palin))
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To: Mr. K

nah, this company took on the idiot Corzine in 2010 and he almost immediately gambled on CDS high risk investments with client money-

“commingled” is the polite term for stealing

Basically under Corzine’s short leadership the investment firm hoovered out money from client accounts, gambled and lost

(I read that Gerald Celente lost the value of his 6-figure precious metals account)

Tyler Durden (ZeroHedge) published an Ann Barnhardt rant last week- excellent

I guess the idiots who knowingly stayed invested in M-F Global thought Corzine’s political connnections were too big to fail


27 posted on 11/21/2011 9:10:33 AM PST by silverleaf (common sense is not so common- voltaire)
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To: ken5050
They're now talking to the feds,a nd attemptig to work out plea bargains for themselves. The Feds wan direct testimony linking Corzine to the criminal acts..

If this is true, look at the bright side. Supposing for the moment that Corzine doesn't skate because of his Democratic connections, he's got enough money to actually make good on $500 million of the theft!

28 posted on 11/21/2011 9:10:40 AM PST by Pearls Before Swine
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To: Terry Mross

Bingo!


29 posted on 11/21/2011 9:15:25 AM PST by sappy
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To: quesney

We are now moving at faster than the speed of light? We crossed over to another dimension and are winking out of the space/time continuum? You have just entered the Twilight Zone.


30 posted on 11/21/2011 9:17:27 AM PST by Texas Fossil (Government, even in its best state is but a necessary evil; in its worst state an intolerable one)
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To: Pearls Before Swine; All
Would like to try and clear up what happened, at least what I think happened..

MF Global was speculating on soverign debt...and doing so highly leveraged..estimates are 30:1 if not higher.

That means that you can control ( buy) $ ONE billion of debt for about $30 million down. Corzine bet the ranch that Europe would stay solvent..he went long.. If the value of the bonds increase, you make money. If the bonds decline your entire margin balance is wiped out, and you have to post more margin, or they close out your positions.

MF Global got massive margin calls..probabaly from European banks..( if the trades were with US firms, they'd be talking about it already. Corzine thought he was a "master of the universe"..if the trades were closed out, he, and the firm, were finished..so he "borrowed" the customers' $$ to post more margin, and that also was lost...when the bonds declined further..

31 posted on 11/21/2011 9:20:34 AM PST by ken5050
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To: quesney

Corzine needs to see the inside of Rikers Island for an extended stay. That’s the only way to prevent future episodes like this.


32 posted on 11/21/2011 9:22:47 AM PST by NativeNewYorker (Freepin' Jew Boy)
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To: quesney
FOB - Friends of Bari

Corzine was one if Bar's economic advisers and big-time campaign bundlers.

33 posted on 11/21/2011 9:23:59 AM PST by TexasCajun (Fast & Furious , Solyndra & Light Squared would be enough to impeach any White President !!)
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To: quesney

Obama Flashback: Praises White House ‘Partner’ Jon Corzine ... ‘He Tells It to You Straight!’

http://nation.foxnews.com/president-obama/2011/11/16/obama-flashback-praises-white-house-partner-jon-corzine-he-tells-it-you-straight


34 posted on 11/21/2011 9:27:24 AM PST by Qbert ("The best defense against usurpatory government is an assertive citizenry" - William F. Buckley, Jr.)
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To: circlecity
by stealing money from customer's segregated accounts to make super high risk investments.

Typical leftists. Everything they do involves using other people's money.

35 posted on 11/21/2011 9:29:38 AM PST by Hoodat (Because they do not change, Therefore they do not fear God. -Psalm 55:19-)
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To: bert
The loss is the gambler’s equivalent of trying to make up losses at the roulette table with the kid’s college money

Correction: The loss is the gambler’s equivalent of trying to make up losses at the roulette table with other people's kids' college money.

ML/NJ

36 posted on 11/21/2011 9:31:52 AM PST by ml/nj
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To: silverleaf

I did...and if what she says about this being the tip of the iceberg as to others’ exposure to Corzone’s MF, we have only begun to see the damage.


37 posted on 11/21/2011 9:33:35 AM PST by SueRae (I can see November 2012 from my HOUSE!!!!!!!!)
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To: quesney

Corzine gets half. The O’Bastard campaign war chest gets the other half.


38 posted on 11/21/2011 9:34:25 AM PST by crosshairs (Liberalism is to truth, what east is to west.)
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To: quesney
Shortfall Could Be $1.2 Billion+

Note the plus sign. I think when this all broke Ann Barnhardt was using the number $1.6 Billion.

The big question really is: why hasn't Jon Corzine been indicted yet?

ML/NJ

39 posted on 11/21/2011 9:35:54 AM PST by ml/nj
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To: Kartographer
One more to add to that list:

1. You can get away with all of this as long as you happen to be a Democrat.

40 posted on 11/21/2011 9:35:58 AM PST by Hoodat (Because they do not change, Therefore they do not fear God. -Psalm 55:19-)
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To: ken5050

Re your post 31: That’s exactly what I think happened, too. They tried to cover what they hoped was a temporary margine fund with customer cash. What part of “segregated funds” didn’t Corzine and his underlings not understand?


41 posted on 11/21/2011 9:48:40 AM PST by Pearls Before Swine
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To: quesney

They really need to take these financier terrorists who steal billions of other peoples money (including taxpayers) and put them in front of a firing squad, instead of dealing with them judiciously with kid gloves and fancy prisons. The level of these thefts should require capital punishment.

The policy should have been implemented starting in 2008 with Madoff and then moved on to the many others. It would put an end this financial thievery and skullduggery.


42 posted on 11/21/2011 9:50:08 AM PST by apoliticalone (Honest govt. that operates in the interest of US sovereignty and the people, not global $$$)
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To: Kartographer

The Ferengi Rules Of Acquisition from Star Trek -

I like that, and it certainly applies.


43 posted on 11/21/2011 9:52:05 AM PST by apoliticalone (Honest govt. that operates in the interest of US sovereignty and the people, not global $$$)
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To: quesney

Anyone told The Messiah that this outfit is jut too big to fail?


44 posted on 11/21/2011 9:52:11 AM PST by Flint
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To: Pearls Before Swine

Thanks..did you see my #20 to you...how I think it went down?


45 posted on 11/21/2011 9:55:41 AM PST by ken5050
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To: ken5050
The Feds wan direct testimony linking Corzine to the criminal acts..

Do you actually know that, or is it wishful thinking on your part?

(If the latter, I'm wishing too)

46 posted on 11/21/2011 10:04:38 AM PST by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: ml/nj
The big question really is: why hasn't Jon Corzine been indicted yet?

Bigger question: "Will he ever be indicted? Or even banned from the Securities industry?".

47 posted on 11/21/2011 10:09:22 AM PST by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: ml/nj

-————other people’s kids’ college money.——

Well, not exactly. The gambler does not have access or signatory authority to other kids college money.

He is however able to co mingle the money in his kid’ s with his own family general account.

The MF’ers co mingled customer money over which they had signatory authority with MF general funds. Lawyers co mingle trust money a lot and many get caught at it


48 posted on 11/21/2011 10:13:53 AM PST by bert (K.E. N.P. +12 ..... Crucifixion is coming)
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To: DuncanWaring
Of course I have no direct knowledge..but it's how the Feds work. If you accept the premise of my post #20, as to how the fraud went down..the "mechanics" of how it happened..then the Feds want to get clear direct testimony from those low on the food chain..you get 5-6 people all testifying to the same thing..that they were told by Corzine to move the funds out of the customers' accounts..and it's a slam dunk case.

You have to realize..Corzin was stupid...really stupid..he never in his dreams thought that he couldn't fix this in a few days, save his positions and the firm, and return the money back to the account. He acted on impulse, never considered the consequences...and never concealed his actions. I'd even wager that the clerks, the back office people who did the actual transfers, asked for email instructions..

Corzine has been quieter than even Madoff ( after he was arrested..) not a good sign, normally..he's in deep doo-doo..and he will be thrown under the bus....unless he has enough dirt on Obama, to force a pardon from Obama after he is defeated next November...

49 posted on 11/21/2011 10:22:02 AM PST by ken5050
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To: ken5050
Thanks..did you see my #20 to you...how I think it went down?

It sounds plausible. One other possibility is that Corzine delegated a lot, and the fund transfer came from below from detail people afraid of him after they carried out his top-level instructions on the bonds. "What--we lost money because you bought THOSE Italian bonds? I'll have your head!"

Even if that's not what happened, I wouldn't be surprised if it becomes the defense story.

50 posted on 11/21/2011 10:22:09 AM PST by Pearls Before Swine
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