Skip to comments.Investigation Into MF Global Expected to Heat Up (RAT Corzine goes to the big house?)
Posted on 01/02/2012 6:14:53 AM PST by Libloather
Investigation Into MF Global Expected to Heat Up
By BEN PROTESS
December 30, 2011, 1:30 pm
When customer money disappeared from MF Global over Halloween weekend, it seemed implausible the cash would remain at large come New Years Day.
But two months later, the hunt for roughly $1.2 billion in client money continues. Some MF Global customers, including farmers and hedge funds, are still without about a third of the money in their accounts at MF Global, the brokerage firm once run by Jon S. Corzine, the former governor of New Jersey.
Against this backdrop, and as 2012 gets ready to begin, the investigation into the MF Global debacle is expected to heat up.
In the coming months, federal authorities are likely to answer crucial questions, including the exact whereabouts of the customer money and who at MF Global caused it to disappear. At some point next year, because MF Global violated rules prohibiting the mingling of customer money and the firms, authorities may also file enforcement actions.
The Federal Bureau of Investigation is exploring whether MF Global violated criminal laws, though no one has been accused of any wrongdoing.
(Excerpt) Read more at dealbook.nytimes.com ...
He goes to the big house, still no one knows where the money is and Zero pardens him at the end of his term. Perfect
Not if you are a well connected Democrat. Corzine will not spend one day in jail, IMO.
The cash will turn up in Obama ads in the fall campaign.
If there is any karma, then at least some of the money Jon-boy was speculating with, came from Russian mafia. If so then Jon-boy might want to stay off high balconies
I would start with looking in the ceramic kangaroo change holder tray next to my bed.
Barrons--The Silver Rush at MF Global
By ERIN E. ARVEDLUND, December 17, 2011
It's one thing for $1.2 billion to vanish into thin air through a series of complex trades, the well-publicized phenomenon at bankrupt MF Global. It's something else for a bar of silver stashed in a vault to instantly shrink in size by more than 25%. That, in essence, is what's happening to investors whose bars of silver and gold were held through accounts with MF Global.
The trustee overseeing the liquidation of the failed brokerage has proposed dumping all remaining customer assetsgold, silver, cash, options, futures and commoditiesinto a single pool that would pay customers only 72% of the value of their holdings.
In other words, while traders already may have paid the full price for delivery of specific bars of gold or silverand hold "warehouse receipts" to prove itthey'll have to forfeit 28% of the value.
That has investors fuming. "Warehouse receipts, like gold bars, are our property, 100%," contends John Roe, a partner in BTR Trading, a Chicago futures-trading firm. He personally lost several hundred thousand dollars in investments via MF Global; his clients lost even more. "We are a unique class, and instead, the trustee is doing a radical redistribution of property," he says.
Roe and others point out that, unlike other MF Global customers, who held paper assets, those with warehouse receipts have claims on assets that still exist and can be readily identified.
The tussle has been obscured by former CEO Jon Corzine's appearances on Capitol Hill. But it's a burning issue for the Commodity Customer Coalition, a group that says it represents some 8,000 investorsmany of them hedge fundswith exposure to MF Global. "I've issued a declaration of war," says James Koutoulas, lead attorney for the group, and CEO of Typhon Capital Management.
At stake is an unspecified, but apparently large, volume of gold and silver bars slated for delivery to traders through accounts at MF Global, which filed for bankruptcy on Oct. 31.
Adding insult to the injury: Of the 28% haircut, attorney and liquidation trustee James Giddens has frozen all asset classes, meaning that traders have sat helplessly as silver prices have dropped 31% since late August, and gold has fallen 16%. To boot, the traders are still being assessed fees for storage of the commodities...
THIS JUST IN CORZINE--The same man who oversaw MF Globals $1.2 billion in missing funds, Bradley I. Abelow, is also currently listed on the Environmental Protection Agencys website as the current chairman of the EPAs Financial Advisory Board.....but did not advise Congress of his position.
Abelow was Corzine's G/S crony. Corzine appointed Abelow state treasurer and was also Corzines chief of staff.
They both went to run MF Global alomg with Chris Flowers who handled Corzine's "blind trust." Interestingly, current EPA Administrator Lisa Smith also previously served as Gov. Corzines chief of staff. Whether the Corzine connection played any role in Abelows appointment to the chairmanship of the EPAs Financial Advisory Board is as yet unclear.
Abelow, who as recently as July 2011 appears to have donated $30,800 in campaign donations to the Democratic National Committee and $5,000 in June to President Barack Obama, said over a dozen times during congressional hearings that he didnt know how MF Global customers funds disappeared under his watch. Read more at biggovernment.com ...
CONGRESS SHOULD BE ALL OVER THIS Abelow and Corzine misled Congress on several points:
1. When Congress asked Abelow about "previously working with Corzine," close-mouthed Abelow reluctantly mentioned being Gov Corzine's COS. Abelow MADE NO MENTION of Corzine appointing him to head NJ's Dept of the Treasury---where the two con artists controlled ALL of NJ's tax assets.
2. Abelow and Corzine SHOULD have been pressed about their formation of an investment company while they were principals of NJ govt and controlled its assets. The two "financial geniuses" later said they did not know investment companies run by govt principals are illegal.
3. Congress needs to know why Abelow is witholding crucial info. What does he have to hide? Abelow 's financial activities at EPA need top to bottom investigations.
Check out his girlfriend.
ANALYSIS It defies imagination and common sense that these "financial geniuses" can't figure out where the missing $1.2 billion is.
Monies transferred in and out of MF Global continually.....all done by wire transfer------EFT. There's a clear record of when, where, and how much for EACH wire transfer......like your cell phone bill. Each call is listed, the number dialed, the time of the call, and the duration. So they absolutely know exactly who got the $$, and when it was received.
Corzine/Abelow/Flowers were not able to remove the customer funds alone. It required conspiring and colluding with most of MF's key back office personnel ........who all had to know that it was 100% illegal to do so. Yet NO ONE blew the whistle, and called the regulators? This underlines the corrupt corporate culture that predominates today on Wall Street.
So, why did they go along? Were they assured it would be put back in a day or two......that it was a temporary glitch? If they didn't agree, the firm would go under? Their jobs would be lost if they didnt go along?
Savvy observers say many MF insiders are now working out deals with the Feds, to name names and provide direct testimony as to who exactly ordered the customers' funds to be removed from the accounts.
Count on direct testimony that Corzine ordered illegal acts.......written records are also to surface. Corzine is toast. Obama and the Dems will toss him under the bus. Corzine is making a huge mistake by underestimating the anger of Jerseyans he left holding the bag----he socked us with massive debt, bankrupt state agencies, and a state pension fund 25% lighter,
Corzine departed with billions of tax assets unaccounted for. Throwing him under a bus is too good for him......considering the damage he's caused.
If Corzine was a Republican, he’d be in prison already.
He must have saw his life flash before his eyes when he was in that severe car crash a few years ago, he saw that he was going to hell, so he decided to pilfer as much money as he could before he dies.
Yep, this piece of slimy dirt Corzine would be pardoned by Obozo. So wait to convict him until Obozo gets escorted out of the WH for good.
Corzine is very wealthy, and would contest any criminal charges to the full extent. The trial would last months as his team of attorneys questioned every piece of evidence and grilled every witness.
The best approach, I think, would be to charge him with SOX violations. If he certified as CEO that sufficient controls existed, and they really did not, that is an easy target.
Ann Barnhardt at www.barnhardt.biz is calling for a financial general strike:
I’m Calling for a General Financial Market Strike
Posted by Ann Barnhardt - December 20, AD 2011 9:10 PM MST
I have received a few emails asking if I was still content with my decision to shut down my brokerage. Not only am I content, but after seeing the news that broke over the weekend, I am of the considered opinion that the entire financial blogging community should formally call for a general financial market strike. And Im not kidding. A couple of things have happened regarding the MF Global mess that I dont think got the attention they should have because they broke over the weekend. So let me fill you all in.
First, all notions of personal property rights were essentially destroyed when the MF Global trustee began seizing customers gold and silver bullion held in storage if that bullion was purchased through contracts brokered by MF Global. In case youre not following, let me restate. MF Global customers who traded in precious metals and actually took delivery and OWNED bullion, as in outright, free and clear OWNERSHIP, complete with a warehouse receipt (aka title) with SERIAL NUMBERS designating exactly which physical bars they OWNED, and were PAYING RENT to STORE their own property in a secure VAULT, complete with statements indicating that these storage fees were paid in full, are having THEIR PROPERTY THAT THEY OWN AND ARE PAYING RENT TO STORE CONFISCATED by the MF Global trustee in order to feed the gaping maw that is the MF Global estate.
This would be EXACTLY like if you rented a little storage space at one of the thousands of storage facilities that dot this nation, and stored a car there. I used to do exactly this when I had multiple cars. Imagine the owner of the storage facility went bankrupt. Now imagine that a trustee SEIZED YOUR CAR, sold it, and used YOUR PROPERTY to feed the storage franchise owners BK. Nevermind that you had an explicit RENTAL AGREEMENT and that you had receipts proving that you were paying monthly rent on said storage space, and that you could produce clear title to the car showing that you owned it, and that the VIN numbers matched.
Do you understand what is happening now? This is outright confiscation of personal property. After having their money stolen out of their accounts and being locked out of their accounts, unable to trade or even liquidate WHILE THE MARKETS CONTINUED TO TRADE, these people are now having their PERSONAL PHYSICAL PROPERTY stolen and redistributed to the MF Global estate, in order to feed Corzines gambling debts MADE ILLEGALLY WITH FUNDS STOLEN OUT OF THE CUSTOMER ACCOUNTS to repay counterparties with J.P. Morgan at the fore.
So guess what? This is now establishing the precedent that ANY property held by a third party can be seized and confiscated to feed a bankruptcy of said third party. This includes BANK DEPOSITS. Now, please consider that all of the major banks in the United States are insolvent, and insolvent MULTIPLE TIMES OVER. Bank of America, Wells Fargo, Citi, all of them. When these banks collapse and they WILL collapse - any deposits they are holding WILL BE CONFISCATED and redistributed to their counterparties. Citation URL here at Market-Ticker.org:
Oh, but theres more.
Also announced over the weekend was the jaw-dropping, yet illuminating fact that the MF Global bankruptcy was fraudulently, nefariously and illegally drawn up as a Chapter 7 BK for a SECURITIES DEALER and NOT a commodity brokerage as it should have been. Look, MF Global was the second-largest non-bank FCM in the United States next to NewEdge which is the old FIMAT. If MF Global wasnt an FCM, then there are no FCMs. Of course it was an FCM. It had $7.2 billion in customer seg funds as of August 31, 2011. And yet MF Global was immediately, from the get-go, put into Chapter 7 BK as a SECURITIES FIRM. This is fraud. MF Globals BK should have OBVIOUSLY been established under Subchapter IV of the Chapter 7 code as a COMMODITY BROKERAGE.
Why wasnt this done? Because in a Subchapter IV liquidation of a commodity brokerage firm, guess who is absolutely and unequivocally at the front of the line? You guessed it: the CUSTOMERS. In the Chapter 7 liquidation of a securities firm, guess who goes to the front of the line? Uh-huh. The creditors, aka the counterparties on the firms proprietary positions. As in . . . J.P. Morgan, et al.
Now we know why this unprecedented action of raping the customers has happened. It was set up that way. Now are you telling me that NO ONE at the CFTC appreciated the difference between the BK subchapters? Are you honestly telling me that Terry Duffy and NO ONE at the CME understood the difference between a securities firm liquidation and a Subchapter IV commodities firm liquidation and the massive consequences to the customers? Not a single one of them understood this massive difference? Bullshit. Of course they knew. They set it up that way from day one. And they continue to know. And this fricking charade just keeps going and going, and the rape and confiscation of the customers’ property continues apace. The fix was in on the customers and J.P. Morgan was put at the front of the line willfully, intentionally and with extreme malice aforethought by all those parties concerned. Citation Hotlink here:
Click Here to read the ZeroHedge reportage.
And this is why I am now formally calling for the financial industry blogging community to officially push for and declare a general market strike. I call for all decent people of good will to withdraw ALL FUNDS from the financial markets and cease to trade in solidarity with the MF Global rape victims until such time as the MF Global BK is properly filed as a Subchapter IV commodity brokerage liquidation and their private property is FULLY RESTORED.
If this is how theyre going to play, I say lets shut the whole damn thing down. Lets show these rat bastards how we do things in the Civilized World. Molon Labe.
Due to flight risk, have they confiscated his passport yet?
There is this governor of what was once the Empire State who ran an agency called HUD who lost at least this much. I understand he got an $18 mil bonus for doing so. And still no trace of the missing funds.