House Committee Votes to Subpoena Corzine on MF Global

Associated Press

A congressional panel has subpoenaed former Sen. Jon Corzine to testify next week about his role leading MF Global, a brokerage firm that collapsed this fall after a disastrous bet on European debt.

The House Agriculture Committee voted Friday to issue the subpoena. Committee Chairman Rep. Frank Lucas, R-Okla., said his testimony is “essential to fulfill our objectives.” Lucas said the subpoena was necessary because Corzine hadn’t answered an informal request to testify at the Dec. 8 hearing.

A representative for Corzine didn’t immediately return a telephone call seeking comment.

It’s rare that a former member of Congress is subpoenaed to testify about something under federal investigation.

MF Global filed for bankruptcy protection on Oct. 31. Corzine resigned as chairman and CEO a few days later. In just a week, stock investors lost an estimated $585 million.

Regulators are looking into whether MF Global used money from customers’ accounts for its own purposes as its financial condition worsened.

An estimated $1.2 billion or more may be missing from customer accounts. Regulators say MF Global moved money out of customer accounts within days as the firm’s cash dried up.

Two other congressional committees also have asked Corzine to testify about MF Global this month.

MF Global was one of the biggest players in the derivatives market. Derivatives are investments that are based on the value of an underlying asset, such as interest rates or oil prices.

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