House Financial Services Committee Releases Staff Report on MF Global

[authors: Kevin M. Foley, Adam J. Spector]

The US House of Representatives Financial Services Subcommittee on Oversight and Investigations (Committee) has released a report on the collapse of MF Global (Report). The Report finds that Jon Corzine, MF Global’s Chairman and CEO, made a number of decisions that ultimately caused MF Global’s bankruptcy. The Committee also found fault with the regulatory agencies, rating agencies and the New York Federal Reserve Board, among others. In particular, the Report faults the Commodity Futures Trading Commission and the Securities and Exchange Commission for failing to share critical information that would have provided a more complete picture of the company’s financial health. The Report also found that rating agencies, such as Moody’s and S&P, failed to sufficiently review MF Global filings or understand the nature of various aspects of MF Global’s business, thereby missing the opportunity to identify many risks that should have been identified.

The Committee’s report can be found here.