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Sunday, June 23, 2024 | Back issues
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MF Global Collapse Still|Hangs Over Jon Corzine

MANHATTAN (CN) - Former New Jersey Gov. Jon Corzine must face charges that he ran MF Global into the ground, a federal judge ruled.

The U.S. Commodity Futures Trading Commission filed suit in June 2013 against MF Global Holdings, Corzine and MF's assistant treasurer Edith O'Brien. Corzine and O'Brien moved to dismiss, and the U.S. Commodity Futures Trading Commission responded by filing an amended complaint in December 2013.

U.S. District Court Judge Victor Marrero sided with the federal agency Friday.

"The facts alleged in the 105-paragraph amended complaint provide Corzine and O'Brien more than ample notice of the nature of the CFTC's claims against them and give rise to reasonable inferences that Corzine and O'Brien violated the Commodity Exchange Act by illegally transferring funds from customer segregated accounts," Marrero wrote.

Marrero had ordered MF Global just a couple of months ago to fork over $1.2 billion in restitution to investors blindsided by the company's October 2011 collapse. He also slapped the company with a $100 million civil penalty after it pays back investors and creditors.

The latest ruling preserves all facets of the consolidated shareholder complaint against Corzine and 22 other MF Global directors.

After the company's collapse, the company failed to account for some $75 million of customers' money.

The CFTC claimed that Corzine placed bad bets on European sovereign debts.

A bankruptcy judge in October 2013 cleared MF Global to pay back its debts to commodity customers.

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