MF Global CEO Jon Corzine Resigns

Jon Corzine steps down and will forgo a $12.1 million severance package.

ByABC News
November 4, 2011, 9:30 AM

Nov. 4, 2011 — -- Jon Corzine resigned today without severance pay as head of MF Global, the bankrupt brokerage firm where he had hoped to resurrect his career after a failed gubernatorial re-election bid in New Jersey.

Corzine has resigned from all posts and has confirmed "that he will not seek severance payments in connection with his resignation," the company said in a statement today.

His severance package was worth $12.1 million, including cash and benefits, the Associated Press reported.

Securities regulators and the FBI are now investigating more than $600 million in missing customer money. Brokerages are required to keep the money they invest separate from client accounts.

"I feel great sadness for what has transpired at MF Global and the impact it has had on the firm's clients, employees and many others," Corzine said in a statement, reported the New York Times. "I intend to continue to assist the company and its board in their efforts to respond to regulatory inquiries and issues related to the disposition of the firm's assets."

Corzine has retained the services of white-collar criminal defense lawyer Andrew Levander, reported the New York Times.

The company said Edward Goldberg, the lead director of the board of directors, and Bradley Abelow, president and chief operating officer, will continue in their positions.

The downfall of MF Global, related to the company's exposure to European sovereign debt, accelerated quickly in October, leading to its filing for bankruptcy protection Monday. Credit-rating firm Moody's downgraded the firm's debt shortly before the company released its second quarter results Oct. 25, when it reported decreased revenues.

The Commodity Futures Trading Commission and Securities and Exchange Commission said Monday MF Global "reported possible deficiencies in customer futures segregated accounts held at the firm."

Reports then surfaced Tuesday regarding an FBI investigation to determine whether customer money was missing.

MF Global attorney Kenneth Ziman told a New York City bankruptcy judge there was no shortfall and that management had accounted for all the "missing money."

Gary Gensler, chairman of the Commodity Futures Trading Commission, told Congress Thursday, "The most troubling aspect about MF Global's situation is the shortfall of customer money in the firm."

Corzine has already been named in a shareholder lawsuit that accuses him of touting MF Global when he knew the firm was hemorrhaging cash.

Brought on to lead MF Global into the next level as a financial institution, Corzine had come from politics after losing his job as CEO of Goldman Sachs. His career as CEO of Goldman Sachs spanned from 1994 until 1999, until he was ousted.

He eventually left Goldman a richer man and used some of his wealth for his political campaigns. He was a New Jersey senator from 2001 to 2006, then governor from 2006, leading the state through a government shutdown and a crisis in municipal funding that many localities and states had to endure.

His tenure ended when Gov. Chris Christie defeated him in 2009.