Corzine, Other Former MF Global Officers Settle Investors’ Lawsuit


Jon Corzine, the former CEO Jon Corzine together with other former executives of MF Global Holdings settled the lawsuit filed by investors.

MF Global Holdings went bankrupt in 2011 after its bad bets on European sovereign debt. Investigators found that the firm illegally transferred customers’ assets, and there was a $1.6 billion shortfall in their accounts, which were supposed to be separated from MF Global’s funds.

The investors of MF Global filed a lawsuit against Corzine and other former executives of the firm claiming that they must be accountable for the collapse of the firm.

Corsair Took A Hit From Small-Cap Underperformance In Q3; Says Evergrande Not The Next Lehman Brothers

Corsair CapitalCorsair Capital was down by about 3.5% net for the third quarter, bringing its year-to-date return to 13.3% net. Corsair Select lost 9.1% net, bringing its year-to-date performance to 15.3% net. The HFRI – EHI was down 0.5% for the third quarter but is up 11.5% year to date, while the S&P 500 returned 0.6% Read More

The Virginia Retirement Systems and the Province of Alberta in Canada were among the investors that filed a case against the former executives of MF Global.

The investors claimed that the former executives inflated the ability of the firm to manage risks, obscured the risks related to Corzine’s $6.3 billion bet on European sovereign debt, and improper accounting for deferred tax assets.

In 2013, Louis J. Freeh, a former FBI director and trustee of MF Global Holdings said Corzine committed negligent conduct as CEO of the firm. According to him, Corzine and his team practice trading strategies with minimal oversight and they failed to improve faulty controls despite receiving warnings.

Details of the settlement between Corzine and investors

Corzine and other former executives of MF Global agreed to a $64.5 million settlement with investors. The settlement boosted investors’ recovery of assets to $204.4 million including $74.9 million from underwriters and $65 million from PricewaterhouseCoopers.

The lawyers representing the investors said the $204.4 million recovery represents 18% of the maximum reasonably possible. According to them, it was an excellent result given the fact that MF Global went bankrupt.

J. Randy MacDonals, Henri Steenkamp and seven former independent directors of MF Global were part of the settlement. All of them denied wrongdoing.

MF Global ordered to pay $100 million penalty

Last year, the Commodity Futures Trading Commission (CFTC) obtained a court order against MF Global. The court ordered that firm to pay a $100 million penalty and to pay $1.2 billion in restitution for unlawful use of customer funds.

Updated on

Marie received her Bachelors Degree in Mass Communication from New Era University. She is a former news writer and program producer for Nation Broadcasting Corporation (NBC-DZAR 1026), a nationwide AM radio station. She was also involved in events management. Marie was also a former Young Ambassador of Goodwill during the 26th Ship for Southeast Asian Youth Program (SSEAYP). She loves to read, travel and take photographs. She considers gardening a therapy.
Previous article Wilbur Ross: Greek Drachmazation Would Be Terrible
Next article Japan’s Kuratas Accepts Challenge From US Robot Firm MegaBots

No posts to display