REUTERS/Jonathan ErnstIn November 2011, commodity futures brokerage MF Global was liquidated after then-CEO Jon Corzine's levered bets on risky European sovereign debt didn't pan out.
In the process, $1.2 billion of customer funds deposited in brokerage accounts – supposedly "sacrosanct," separated from the firm's own money – vanished.
Today, in what many victims would probably describe as "too little, too late," the CFTC finally brought a (civil) suit against Corzine.
CFTC Commissioner Bart Chilton was just on CNBC, and anchor Mandy Drury posed a pointed question to him: What took the CFTC so long to notice that there was a misuse of client funds?
After all, it seems like everyone else had that figured out a year and a half ago.
Well, one of our charges, one of the counts we have here, is we allege that they falsely reported, Mandy. I mean, we're talking about hundreds of millions of dollars in false reporting.
They were undersegged – that means they didn't have the money they were supposed to – and they transferred money around like it was a shell game.
So, it's one thing to say that regulators should do a better job, and I'd agree, as you know, many times. But when people lie to us, it's a little difficult to get to the truth sometimes.
Better late than never?
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