Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Thursday, December 7, 2023
Courthouse News Service
Thursday, December 7, 2023 | Back issues
Courthouse News Service Courthouse News Service

Corzine Takes PwC Out to Pasture in MF Global Trial

Giving jurors more “Pioneer Woman” than “Wall Street,” former New Jersey Gov. Jon Corzine spoke about life on the farm Thursday at a trial on the $3 billion case his now-defunct former company MF Global brought against PricewaterhouseCoopers.

MANHATTAN (CN) — Regaling jurors with tales from his family farm Thursday, former New Jersey Gov. Jon Corzine downplayed his role in MF Global’s collapse five years ago, shifting the blame to the company’s auditor, PricewaterhouseCoopers.

“My father would plant corn in the spring to anticipate the harvest in the fall,” Corzine testified.

More than a wistful recollection, Corzine had been describing the concept of futures trading, one of the services MF Global offered before its spectacular collapse in 2011.

Corzine has testified exhaustively about his role in MF Global’s downfall since that time. In addition to two U.S. attorney’s offices, Corzine has faced investigations by the Securities and Exchange Commission, two other federal regulators, the FBI and Congress.

Most of these probes passed without any charges, except for an action by the Commodity Futures Trading Commission that led to a $5 million settlement in January.

Consistently denying misconduct, Corzine continued to defend his decision to invest heavily in the debt of several European countries, including Spain, Italy, Belgium, Portugal and Ireland.

All of these countries had A1 to AAA ratings at the time, the highest being “relatively riskless,” he testified.

Although all of these investments ultimately got paid back in full, Corzine testified, the market panicked because PwC insisted that these transactions be treated off the balance sheet.

“I believe it was a loss of confidence and trust after our earnings were announced,” Corzine said.

Just a few months before MF Global’s bankruptcy, PwC told the audit and risk committee that it “was not aware of any significant risks or disclosures” in a report on July 26, 2011.

PwC also gave MF Global a “clean audit opinion” in a statement appended to its SEC filing for that year, the jury heard.

Corzine insisted that he had no reason to question the company.

“We relied on our public accountants because they had a strong reputation, and we believed that they had the capacity to make the judgments to be the best of financial reporting,” he said.

Gently questioning the former governor, MF Global’s lawyer Stephen Sorensen, from the Venice, Calif.-based firm Thomas, Alexander & Forrester, had Corzine endear himself to the jury with snapshots from his autobiography.

Born in rural Illinois, Corzine lived on a family farm until he enlisted in Marine Corps as a state university student. He became a senator and governor in New Jersey, and a two-time CEO, starting with Goldman Sachs before his stint at MF Global.

Corzine now teaches at Fairleigh Dickenson University, a New Jersey community college a short drive away from New York City.

PwC will cross-examine Corzine on Friday.

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.