After Jon Corzine's strenuous denial that he had any knowledge of M.F. Global managers raiding customer funds to pay overdrafts, along comes an internal memo that said he didn't just know of the practice, he ordered it.
Bloomberg News had the scoop Friday in the form of an email from an M.F. Global executive that said the controversial $200 million transfer came "Per JC’s direct instructions." M.F. Global was trying to stave off financial collapse, and in doing so it appears to have dipped into client funds to pay off a $200 million debt on one of the firm's accounts at J.P. Morgan Chase in London. This much we knew, but Corzine, who was M.F. Global's chief executive at the time, has always maintained he knew nothing of the practice, which appears to violate federal law. "Mr. Corzine told a House panel that he had received assurances, 'both orally and in writing,' that the firm followed federal laws about keeping customer money separate from firm funds," The New York Times reported in December.The new evidence suggests quite the opposite. According to Bloomberg's Phil Mattingly and Silla Brush, "Edith O’Brien, a treasurer for the firm, said in an e-mail sent the afternoon of Oct. 28, three days before the company collapsed, that the transfer of the funds was 'Per JC’s direct instructions,' according to a copy of a memo drafted by congressional investigators and obtained by Bloomberg News." Not a bad scoop for a sunny Friday afternoon. Well, bad for Corzine, maybe.