Jon Corzine at fault?

A. Nonymous writes:

This article presents former NJ Governor and US Senator Jon Corzine’s sorrow over MF Global Holdings Ltd fraud. He seems very apologetic and worried for the people who were affected by such acts. I don’t know what to believe regarding whether or not Mr. Corzine knew something beyond what he is telling and is just a good actor claiming to be a victim among all of this. What are your opinions? Corzine- another politician who has ruined this amazing country or a person incorrectly questioned for crimes he didn’t commit? Either way, as a person who fundraises for Obama all the time, I doubt any legal action will come of this but I will stick around to find out.

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About Mark P. Holtzman

Chair of Accounting Department at Seton Hall University. PhD from The University of Texas at Austin. Worked at Deloitte's New York Office. BSBA from Hofstra University.

4 comments

  1. Tough call at this point. I think Corzine had higher political aspirations, and was probably on pace to replace Geithner as treasury secretary. Obviously this destroys any chances of that happening. So does Corzine have the audacity to think he could get away with something like this? Probably, but I am not sure that he would risk his chances to become treasury secretary. The political consequences of this will be interesting. Democrats will likely say that if stronger regulations were in place, this would never happen. Republicans will likely go after Corzine as a privileged politician who helped author Sarbanes Oxley so he would know how to get around the rules. It will be interesting to see how the investigation turns out, but maybe this blog should start a weekly honor role of "people doing stupid things" Corzine is a tentative add for that list.

  2. It seems to me that Corzine thought he could get away not having sufficient capital to back up the bet on Europe the firm made. Once word got out about the bet, customers began withdrawing their money. This is when I think everything got messed up. Corzine probably ordered his staff to do what they needed to sure up the balance sheet and a staff member acted on their own in taking money out of customers' accounts. I feel that he knows the firm wrongly took money from customers accounts and is playing dumb to protect himself. I feel like Corzine would be smart enough to not order his staff to take customer's money, but I really wouldn't be surprised if this is another case of "smart people doing stupid things".

  3. I believe that the three main problems with Corzine are:1)He thinks he is a lot smarter than he is2)He doesn’t understand risk as well as he does3)He has this innate need to be perceived as importantI read about him a while ago while reading about Goldman Sachs, where he was pretty much kicked out. He somehow convinced the board to chose him as the new company’s CEO despite the fact that the trading desk that he ran lost billions of dollars. He unsuccessfully took GS from a privately held partnership to a public company, started calling himself the CEO, and was ultimately kicked out from GS by Hank Paulson – He left with a golden parachute of a couple of hundred million dollars.I am not going to go into the mess he created in NJ as governor, but suffice to say, big part of the reason this state is bankrupt is because of Corzine.I read that the main reason why Corzine took the MF Global “gig” – other than the $12.1 million parachute- was that he thought he could recreate his “glory days” at Goldman Sachs and turn the little brokerage house into a titan. So what did he do? He made leveraged investments of 30–to-1 in the PIGS nations, and here is the result: the company went bankrupt. In addition, he claims to have no knowledge of where the $1.2 billion of customers’ money went. I honestly believe that Corzine is a criminal of the worst kind, but like Dr. Holtzman mentioned, being Obama’s buddy might prove to be his latest golden parachute.Fun Fact # 1: I remember reading a while ago (I believe it was in GoingConcern) that the real reason why we can’t be mad at Corzine, is because of that innocent grandpa beard he has, and that’s why he doesn’t shave it.Fun Fact # 2: He wrote most of the Sarbanes-Oxley act back in 2002. I didn’t know that.Blackswan87

  4. I believe that Corzine is going to find himself in deeper and deeper water as this whole scandal unravels. His claims that "I am not an accountant" are unsettling to say the least. I understand that he is not an accountant and may not understand the intricacies of accounting in his company but as CEO, he clearly understands the ramifications of moving nearly $1 billion dollars out of customer accounts as the company was heading over the edge. He is going to end up being held responsible, as he rightly should as CEO, for everything that this company did wrong.

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