Corzine Sharply Criticizes House Panel’s MF Global Report

Corzine also takes issue with the subcommittee report’s assertion that MF Global’s “belated disclosure in October 2011 of its extensive European RTM portfolio–which amounted to 14% of MF Global’s total assets–combined with poor earnings news prompted credit rating agencies to downgrade the company’s credit rating to junk status.”

Says Goldberg: “The Subcommittee fails to recognize that the RTM investments were in fact fully disclosed prior to October 2011. MF Global made full disclosure of the RTM positions in its 2011 10-K, which was publicly filed in May 2011, and in its 2012 first quarter 10-Q, which was publicly filed in August 2011, and the market did not react at those times.”

Furthermore, Goldberg says, the suggestion by the Subcommittee that Corzine created an “authoritarian” atmosphere “is wrong.” All of the MF Global’s significant business decisions, he says, “including the change in business strategy and the RTM investments, were subject to review, debate and approval by the MF Global Board of Directors. In fact, the RTM investments were heavily debated and ultimately approved by the Board, which placed limits on the level of those investments.”

Finally, Goldberg addressed the number of assertions the Subcommittee makes as to Corzine’s “failures” in managing MF Global. Said Goldberg: “When Mr. Corzine joined MF Global he was tasked with quickly turning around a failing business, shoring up internal processes and controls, and, most importantly, immediately returning MF Global to profitability. He set a new strategy for the firm after extensive discussions with the Board, the senior management team and well respected outside consultants. At all times Mr. Corzine acted in good faith and did what he believed was necessary to turn around MF Global.”