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发帖数: 29846 | 1 By AARON LUCCHETTI, MIKE SPECTOR and JULIE STEINBERG
MF Global Holdings Ltd.'s management "seriously underestimated both the
speed and extent" of the panic that overtook the securities firm in late
October, a bankruptcy trustee said Monday, adding that he might pursue
claims against the company's former chief executive, Jon S. Corzine.
In a 275-page report filed with a bankruptcy court Monday morning, James
Giddens, now winding down MF Global's U.S. brokerage unit, outlined how the
aggressive trading strategy pushed by Mr. Corzine, a former Goldman Sachs
Group Inc. GS -0.90% chairman and New Jersey governor, brought MF Global to
the brink.
According to Mr. Giddens, MF Global suffered from a "lack of sufficient
monitoring and systems, which resulted in customer property being used
during the liquidity crisis to fund the extraordinary liquidity drains
elsewhere in the business."
Mr. Giddens, who is charged with trying to recover an estimated $1.6 billion
for customers of the U.S. brokerage, said the report doesn't draw
conclusions on possible criminal liability.
He did say he might sue Mr. Corzine and other MF Global executives on claims
that include breach of fiduciary duty and negligence. In a summary of the
report, Mr. Giddens singled out the actions of MF Global Chief Financial
Officer Henri Steenkamp and former MF Global Assistant Treasurer Edith O'
Brien, who was involved with a key money transfer on Oct. 28, the last
trading day before MF Global filed for bankruptcy.
Attempts were being made Monday morning to contact all three.
The report also went into significant detail about Mr. Corzine's strategy of
transforming MF Global from a relatively sleepy commodities brokerage
operation into one that took the same kinds of risks and trading positions
that have been common at large Wall Street banks like Goldman Sachs.
Mr. Giddens' report noted that Mr. Corzine's trading strategy of betting on
European sovereign bonds in 2010 and 2011 took on "a level of risk that was
orders of magnitude greater than the relative exposure at other, larger
institutions." He said the investments peaked in October 2011 at $7 billion,
or $700 million more than previously known. |
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