SOTU Just More Words: Wall Street
Obama said he would not go back to the days when Wall Street was allowed to play by its own set of rules or allow financial institutions to make risky bets with customers’ deposits… unless they happen to be your “Wall Street guy” who bundled over $500,000 for your campaign.
Obama’s Wall Street Guy’s Firm Went Bankrupt And Lost $1.2 Billion In Customers’ Funds
President Obama: Jon Corzine Is “Our Wall Street Guy.” “The rollout also provided a showcase for Corzine, the former Goldman Sachs CEO whom Obama referred to as ‘our Wall Street guy’ at a meeting of Democratic governors in Chicago on Friday.” (Claire Heininger, “Corzine Profile Rises In Obama Camp,” The Star-Ledger (NJ),6/23/08)
- President Obama: “Jon Corzine wasn’t just the first governor to pass an economic recovery plan for his state;he was an ally with the Obama administration in helping us develop a national recovery plan.” (President Obama, “ Remarks By The President At New Jersey Rally For Governor Jon Corzine,” Holmdel, NJ, 7/16/09)
October 31st: Jon Corzine’s Wall Street Firm, MF Global, Filed For Bankruptcy. “Broker-dealer MF Global, headed by former New Jersey governor and Goldman Sachs chairman John Corzine, has filed for bankruptcy protection, apparently because of holdings of European debt.” (“Broker-Dealer MF Global Files For Bankruptcy,” USA Today, 10/31/11)
- The Eighth Largest Bankruptcy In US History “Has Shaken Faith In The Markets.” “The case — the eighth-largest bankruptcy in U.S. history — has shaken faith in the markets and put business on hold for many owners of the roughly 38,000 securities and commodities trading accounts at the firm, from big-city traders to heartland farmers.” (James O’Toole, “The MF Global Money Chase,” CNN Money, 12/6/11)
Up To $1.2 Million Is Missing From Customers Of Jon Corzine’s Firm. “The court-appointed trustee overseeing MF Global’s bankruptcy says up to $1.2 billion is missing from customer accounts, double what the firm had reported to regulators last month.” (Marcy Gordon, “MF Global Trustee Says $1.2B Or More Missing,” The Associated Press, 11/21/11)
Corzine And MF Global Exemplify How Political Connections Matter In Obama’s “New Era Of Regulatory Power”
“MF Global Also Shows How This New Era Of Regulatory Power Puts A Premium On Political Connections.” (Editorial, “Mr. Corzine And His Regulators,” The Wall Street Journal , 12/1/11)
The CFTC Proposed A Rule That Would Have Resulted In A “Crackdown” On MF Global’s Behavior In October 2010, But “Met A Powerful Roadblock In Mr. Corzine.” “Mr. Gensler’s agency initially proposed the crackdown in October 2010, and neared a vote on the plan this summer. But at the time, the agency met a powerful roadblock in Mr. Corzine, former Democratic governor of New Jersey.” (Ben Protess, “Regulator Approves ‘MF Global Rule,’” The New York Times’ “Dealbook,” 12/5/11)
Corzine Launched An “Aggressive Lobbying Campaign” And Delayed The Rule From Taking Effect. “Mr. Corzine’s efforts culminated on July 20, as MF Global executives were on four different calls with the agency’s staff. Mr. Corzine personally participated in two of those calls. Ultimately, the aggressive lobbying campaign helped delay the proposal.” (Ben Protess, “Regulator Approves ‘MF Global Rule,’” The New York Times’ “Dealbook,” 12/5/11)
Corzine’s Firm Urged Regulators To Allow Firms To Invest Their Customers’ Funds In Foreign Debt . “Late last year MF Global — the failed investment firm headed by Democratic heavyweight Jon S. Corzine that can’t account for as much as $900 million of its clients’ money — urged a federal agency to allow futures firms to invest funds from their customer segregated accounts in foreign sovereign debt.” (Nancy Watsman, “Corzine’s MF Global Pushed Regulators To Use Client Funds,” The Huffington Post, 11/4/11)
- “And It Is Now Clear That He Personally Lobbied Regulators And Auditors About The Strategy.” (Azam Ahmed, Ben Protess And Susanne Craig, “A Romance With Risk That Brought On A Panic,” The New York Times’ “ Dealbook,” 12/11/11)
