Obama administration gives Democratic ex-governor slap on the wrist

Jon Corzine

Just days before the federal transition of power to a new administration, federal regulators settled civil charges  against a former Democratic governor for a fraction of the amount investors allegedly lost.

Former New Jersey Governor and Goldman, Sachs chief executive officer Jon Corzine was fined $5 million and barred from the commodities trading industry for his failures to supervise activity in customer accounts at his firm, MF Global. As a result, according to regulators, Corzine’s firm used customer funds supposed to be kept in escrow in segregated accounts, to both pay other customers and cover its own expenses.

These practices — fundamental violations of basic regulations in several industries — resulted in a loss to investors of nearly $1 billion. Corzine was charged in his role as chief executive officer with failing to supervise subordinates in safeguarding customer account funds.

MF Global became insolvent in late 2011. Investors’ losses approached $1 billion. The fine to Corzine represents about one half of one percent of that amount.

As part of the settlement Corzine agrees not to seek payment from any insurance policy, or other indemnification under any other contract or policy, for the amount of the penalty. This is an effort to ensure that Corzine personally pays the penalty without recoupment from other sources.

Prior to being CEO of MF Global, Corzine was Governor of New Jersey from 2006-09. He lost reelection in November 2009 to current Governor Chris Christie.

Federal regulators at the Commodities Futures Trading Commission and Corzine’s lawyers agreed to the settlement, which became final when accepted by a Manhattan federal district court judge assigned to the pending civil case.

More information on the settlement is available from the CFTC.

Eric Dixon

Eric Dixon is a conservative lawyer, campaign strategist and blockchain technology innovator. He has been an election lawyer and delegate candidate for the presidential campaigns of Ted Cruz and Steve Forbes, and has successfully represented media organizations including National Review in lawsuits against the government. A Yale Law School graduate, Mr. Dixon is headquartered out of New York and represents companies, entrepreneurs and investors on financing, corporate governance and regulatory compliance issues. Mr. Dixon is also a former radio talk show host, think tank research director and has completed thirteen marathons.

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