Missing MF Global Customer Funds May Have 'Vaporized': Report

Jon Corzine still doesn't know where the money is, and it seems nobody else does either.

A "significant amount" of the missing $1.2 billion in MF Global customer funds may have been "vaporized," the Wall Street Journal reports, citing "a person close to the investigation" into the missing funds. The money could have gotten lost during chaotic trading leading up to the brokerage firm's bankruptcy filing.

Yet only one week before the brokerage collapsed, MF Global's CFO sent an email to Standard & Poor's saying the company had "never been stronger," according to Bloomberg.

Some officials reportedly believe that despite public claims to the contrary, the firm was growing more concerned about its European bets, employees dipping into customer money and using it to unfreeze assets at banks and meet demands for more collateral, according to the WSJ.

The report comes nearly two months after former MF Global CEO Jon Corzine, once chief executive of Goldman Sachs, told a Congressional panel "I simply do not know where the money is." The firm filed for bankruptcy in October, after risky bets related to the European debt crisis compromised its position. Corzine resigned shortly after the bankruptcy and the company laid off more than 1,000 workers.

The bankruptcy filing also spawned investigations by multiple federal agencies into allegations that the firm misused hundreds of millions in customer funds. In addition to Corzine, the company's CFO and COO also told lawmakers that they don't know where the missing funds are. Some of the missing money may have been found at a British JPMorgan Chase in November, according to The New York Times.

That hasn't stopped the government from acting. Roughly two months after the extent of the firm's collapse was made clear, the Commodity Futures Trading Commission, a federal regulator tasked with overseeing the derivatives market, approved "the MF Global rule" in order to avoid similarly improper uses of client money in the future, according to The New York Times.

Even if the rest of the money turns up -- a prospect that seems unlikely -- Corzine's reputation may never recover. The former New Jersey Governor, Senator and CEO of Goldman Sachs has become somewhat of a pariah on Wall Street since the meltdown. Some of his former employees created a pinata featuring a photo of him at a holiday party and President Obama gave back tens of thousands of dollars of campaign donations from Corzine.

Earlier on HuffPost:

Comments

[MiddletownHal]

12:23 PM on 02/01/2012

"To vaporize" can be defined as "off shore" and "Switzerland." Hasn't this money created wealth? Isn't America about creating wealth? When some people make money, others have to lose. That's the way it is also & too. I'm in the 1%, so most of the rest of you are therefore losers. If I can earn $100,000 in a week selling short, what business is it of yours? You lost your house you couldn't afford? Get over it. God will provide the wealthy with more opportunity. So be it and God Bless America.

[Thordeer]

09:59 AM on 02/01/2012

There is no longer any accountability at all. The corporations have gotten rid of regulation, antitrust, legal liability, taxes, and white collar crime. Now they are by thousands of times the biggest rogues in the world. We still throw the lower classes in prison for stealing candy at the 7-11 while the CEOs romp around stealing billions. No wonder we have no economy.

[Tquin]

09:07 AM on 02/01/2012

Democrats are skilled at vaporizing money. They then just increase taxes to cover the vaporization.

[Produce guy]

10:15 AM on 02/01/2012

Tquin, spot on. Tax and spend...the democratic motto. Corzine destroyed N.J. now Global. Shame on him!

[anniesez455]

08:58 PM on 02/01/2012

Do Not forget before NJ Corzine botched Goldman Sachs..3 for three here

[treehugger5]

08:41 AM on 02/01/2012

This is ridiculous. My money vaporizes everyday: gas, food, electricity, water. But I can still track the transactions and know where it went. How come the richer you are the more money you can drop and not notice AND get away with it? and if any Democrat haters actually, honestly think their Republican Masters of the Universe know better, please see a doctor. Mental illness will be covered by the Affordable Healthcare Act.

[Angel Ortiz]

06:28 AM on 02/01/2012

Accountability.......throw the pig in jail

[l78lancer]

04:35 AM on 02/01/2012

Knowledge, skills, and abilities.

This is the value-added executives bring to their companies, and why they are handsomely compensated in return. So in case anyone thinks that the corporate leaders on Wall Street (and board rooms across America) all come from the same gold-encrusted, leather and mahogany trimmed, Cuban cigar smoke-filled room boys club (drinking 100 year old brandy), consider yourselves corrected.

Are there any questions?

[Captain Hindsight]

08:29 AM on 02/01/2012

Knowledge = Where the money is
Skills=Moving it from account to acount with no clear trail
Abilities=Making the money "Vaporize" into your own offshore accounts

[treehugger5]

08:41 AM on 02/01/2012

give me enough money and I can learn those skills too.

[Thordeer]

10:01 AM on 02/01/2012

One headline said "Now we know where the MF Global money is," then I clicked on that and it said "May have vaporized."

AAAAAAgGGGGGgggGGGhHHHhhHHHh

[l78lancer]

04:26 AM on 02/01/2012

So will someone remind me why CEOs are paid several thousand time more than their line employees, and receive bonuses and golden parachutes?...

[elizabethlee]

07:02 AM on 02/01/2012

178, it's called political savvy The politicians support these ceo's and in turn the ceo's support the politicians via campaign dollars.

SImple math, as they all attend the same "campagin fund raisers", patting each other on their backs, for a job well done, while their hosting $30,000 per person to grace their "campaign dinners." One more time, its not the little, taxpayer hard working middle class that makes their clock tick.

In another words they all fondle and sleep each other while the taxpayer wonders how they got duped again while they believe the politicians spew rhetoric bullcrap....because the taxpayers and voters are sheep and the politicians have you figured out.....dead left or right.

[Thordeer]

10:03 AM on 02/01/2012

Exactly. And the Boards of Directors of all the big corporations are the executives of the other corporations. Shell's CEO sets Citi's CEO's salary and bonuses, and what goes around comes around.

[l78lancer]

03:24 AM on 02/02/2012

Well done. Thank you for the sanity check - or perhaps insanity check since none of the schmucks are worth a fraction of what they take.

F/F.

[WarpedHuman]

03:25 AM on 02/01/2012

Obviously they won't go to jail for this, everyone knows this already. I just wish someone(group) would pay these thieves a personal visit at their mansions and "vaporize" their smug grins with a well placed fist/boot.

[rebel0498]

02:23 AM on 02/01/2012

They may want to look for it in Greece, Ireland, Portugal or Italy. Good luck in trying to get it back from them, they are in deep dudu.

[aqua0]

02:12 AM on 02/01/2012

He even looks guilty.

[aqua0]

02:07 AM on 02/01/2012

"Vaporize" is an excuse only the 1% is allowed to use and get away with.

[treehugger5]

08:42 AM on 02/01/2012

Right, is this advice good for people when they answer calls from debt collectors?

[Thordeer]

10:03 AM on 02/01/2012

When the poor vaporize something, it's a crime and they get sent to jail.

[JoanneRM]

01:57 AM on 02/01/2012

They HAVE to keep investigating until they find out exactly what happened to the money, or this will happen again. All of the Roosevelt/Depression Era Regulations have to be put back in place. They are what kept us from having a Crash like this all these years. Once they were all gone, the last ones removed in the Bush administration, the economy Crashed. Put them back. What has been passed, was only the beginning of what needs to be put back. For the last 30 years, the Republican Party has worked to bring us back the economy of the 1890's, before the Income Tax, when the Robber Barons ruled. The Democrats found it hard to believe that the "Loyal Opposition" or the "Party in Office" would do something that un-American. Newt Gingrich has actually said that he wanted to get rid of Child Labor Laws, and put poor children to work cleaning the schools where their well off friends go to school.

Well, most of the 99% have come to our senses. This thing has to be investigated until we know what happened.

[rebel0498]

02:19 AM on 02/01/2012

There have ben lots of new regulations since Roosevelt. Can you point out the one that Bush administration removed?

http://www.google.ca/url?sa=t&rct=j&q=time%20line%20%22banking%20regulations%22usa&source=web&cd=3&ved=0CDYQFjAC&url=http%3A%2F%2Fwww.netrootsmass.net%2Fselise%2Ffinancial-regulation-timeline%2F&ei=quUoT9qABZT-2QWmsKHPAg&usg=AFQjCNFEZSKNaItEtcaaKUM3qr2NV91KZA

[elizabethlee]

06:39 AM on 02/01/2012

rebel, lest we not forget that clinton repealed the glass- sheagall bill which allowed, to merge with citi and then the crooks to really came out of the woodwork ergo meaning the ceo's and politicians

Still blaming Bush, eh? You sound not only complacent but rather " I have to blame somebody" and certainly not the party in charge, whom no one place a gun to his head to run for president. Obama wants the glory but not the responsibility.....more rhetoric bullcrap from washington.....and you.

[koos458]

01:29 AM on 02/01/2012

When I say "Kleptocracy," these are the guys I'm talking about.

[jbrainard152]

01:16 AM on 02/01/2012

AAAAHHHH, whada expect from a guy who owns or did own a Supermarket in Middletown N.J.

[dennygboehm]

01:15 AM on 02/01/2012

If you think your worthy of receiving over $10,000,000.00 million dollars a year as compensation, shouldn’t this person be held accountable for anything that happens under their watch? They are being paid as if the organization would fall apart without them. That means the buck stops at the top. If you take the pay you need to take the punishment when things go wrong. This should not be even debatable. This is how I was raised. Why are we so soft on white collar criminals? I believe they do more damage to society than criminals with guns. They destroy trust in institutions that we rely on throughout society whether it is government, bankers, corporations, unions or Wall Street. Once trust is lost the whole system starts to breakdown