Jon Corzine, the former Senator, Governor, Goldman Sachs (GS) CEO, and reportedly obsessive-trading head of MF Global spent much of the last two weeks on Capitol Hill being grilled by Congressional panels regarding his role in the MF bankruptcy and disappearance of $1.2 billion in client money.
Corzine's testimony could serve as a tutorial in how to mislead government officials without technically committing perjury. Corzine didn't actually deny that laws were broken, just that he "never intended to break any rules." Any transfer of client money to cover MF losses resulted from a "misunderstanding."
Corzine is lawyered up and sticking to his playbook. He alleges he knew nothing and is defying the government to prove otherwise.
Conventional wisdom holds that the powerful elite class can get away with literally anything when it comes to rigging the financial system. Regulations are there to be circumvented, underlings exist to be scapegoated, and having enough friends in high places gives defendants access to the inner sanctums where "smoke-filled room" deals are struck.
If Corzine walks without proving his innocence of criminal charges, in a legal and moral way, it will confirm the public's darkest suspicions.
If this is the end of the Jon Corzine story, it will prove in the mind of Main Street that Washington DC and Wall Street have flat-out rigged the system in favor of the elite. If someone is left to the other side of that perception it won't be me.
The unfortunate fact remains that $1.2 billion in client funds are missing. The money didn't belong to banks, but real people who put their faith in MF Global. The money was stolen by any biblical definition of theft. Corzine was the CEO of the firm from which this massive amount of money disappeared. If he can duck responsibility for this crime, then the upper crust can do literally anything it wants, provided the right lawyers are deployed.
Forget the semantics and regulatory parsing, there's one question here: Are the markets deserving of the public trust or not? The case of Jon Corzine will go a long way towards giving us an answer.
- Politics & Government
- Jon Corzine
- Goldman Sachs