Former MF Global CEO Jon Corzine is sworn in to testify before a House Financial Services Committee Oversight and Investigations Subcommittee hearing on the collapse of MF Global, at the U.S. Capitol in Washington, December 15, 2011.
In 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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