Federal regulators are asking the Wall Street investment firm, MF Global, to account for as much as $700 million in customer money that has gone missing. The company was forced to declare bankruptcy this week after potential buyers learned about the missing funds.
Former New Jersey governor and Goldman Sachs executive Jon Corzine ran the company, which bought over $6 billion of debt from countries like Italy, Spain, and Portugal. Company executives were betting that international bodies like the European Union would bail out European governments, rather than let them fail.
A bad quarterly report and news that MF Global had almost no money to cover potential losses led to a run on the company last week. As investigators look into company practices, some investors are asking why MF executives, like Jon Corzine, were guaranteed golden parachutes worth tens of millions even if their actions sank the company.
- Ben Protess, Dealbook reporter for the New York Times
This segment aired on November 1, 2011.