The US Commodity Futures Trading Commission (CFTC) has filed civil charges against former MF Global CEO, Jon Corzine, and former assistant treasurer, Edith O’Brien, for overseeing the misuse of almost US$1 billion in customer funds.
The CFTC is seeking to ban Corzine and O’Brien from the futures industry and impose penalties on both for their role in the company’s collapse.
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The futures brokerage collapsed in October 2011 after making a US$6.3 billion bet on European sovereign debt, and customers were left reeling when it emerged that more than US$1bn of their money could not be found.
Most of that money has since been returned but Corzine, a former governor of New Jersey and chief executive of Goldman Sachs, has said he did not know where the money went.
While the duo is fighting the charges, MF Global’s brokerage unit agreed to settle. It plans to pay back the nearly US$1 billion that customers lost on 31 October 2011, when the parent company filed what ranks as one of the nation’s largest bankruptcies.
The agreement, which awaits bankruptcy court approval, also calls for a US$100 million penalty.
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