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Corzine Blamed for MF Global Demise: Trustee’s Report

CEO knew firms capital and liquidity assumptions were fatally flawed, Freeh says.

By Tiffany Kary and Sophia Pearson, Bloomberg | Updated on April 04, 2013

Former MF Global Holdings Ltd. Chairman and Chief Executive Officer Jon S. Corzine’s risky business strategies and mismanagement helped accelerate the futures brokerage’s demise, according to a report by bankruptcy trustee Louis Freeh.

The 124-page report blames Corzine and his management team for bungling an expansion of the company’s traditional business model while ignoring deficiencies in its risk controls. Corzine’s “aggressive trading strategy” that invested heavily in European sovereign debt produced no significant revenues, and he and Chief Financial Officer Henri Steenkamp knew that the company’s controls were flawed as early as May 2010, according to the filing today in U.S. Bankruptcy Court in Manhattan.

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