Financial Accounting Standards Board

Previewing Today's MF Global Hearing

Today at 2 PM, the House Financial Services Committee will hold its third hearing (and the fifth overall) on the ever more confounding topic of MF Global, its bankruptcy, and its vaporized client funds, which amount to about $1.6 billion at last check. And while Jon Corzine will not be there, virtually everyone else from the firm who can promise that said vaporitzation of funds was merely a softward glitch and not the fault of anyone in particular, will be present, from the General Counsel, to the CFO, to the Deputy General Counsel of JPMorgan, all the way to Edith O'Brien, assistant treasurer of MF Global, who is expected to plead the Fifth. One wonders why if there is nothing to hide, but that is the topic of another discussion. And as exposed last week by the WSJ, this hearing will be particularly interesting as now it has been made clear that Corzine specifically gave the order to transfer funds to JPM's account. As NJ.com summarizes: "Per JC’s direct instructions." This line, contained in an email that an MF Global finance official sent to explain a $200 million transfer to JPMorgan Chase from an MF Global account containing customer funds, will be a focal point of a congressional hearing today into the futures firm’s collapse. The email, disclosed in a congressional memo circulated Friday, has raised questions about whether the former governor and CEO of MF Global knew customer money was being used to plug holes in the firm’s finances as it plunged into bankruptcy during the last week of October. As much as $1.6 billion of client funds has gone missing, according to a trustee liquidating the futures firm."