In a NY Times piece, Teresa Tritch wrote about Louis Freeh’s recently released investigative report of what went wrong when MF Global collapsed in October 2011 due a wayward trade strategy on European debt. At the firm’s helm was former Senator and Governor of NJ Jon Corzine who has not been heard from since (save a few congressional hearings where he said little). Freeh’s report summarized that Corzine “knew, or should have known” about weaknesses in the firm’s internal risk controls. Tritch wrote that the report suggests that “Mr. Corzine passive-aggressively let those weaknesses endure, because stronger controls would have put an end to his bigger-is-better trading strategy.” While Corzine was not criminally prosecuted, and most likely never will be, those loose internal controls that were tolerated within the company cost one young man years in prison … Evan Brent Dooley.
Dooley (45) was a commodities trader for MF Global in February 2008 when he placed a wrong-way trade on wheat. The resulting loss was a whopping $141 million. Dooley was fired and MF Global paid a $10.4 fine for its lack of supervision of Dooley and others. Like most companies that are fined by authorities, they pay them and promise to increase controls to assure these violations never occur again. If anything, MF Global had plenty of human casualties to show that their internal controls were lacking long before the meltdown of October 2011. This week Brent Dooley paid a high price for working at the loosely managed MF Global … he’s heading to federal prison for 5 years and has restitution of $141 million. A lot of money for a guy who qualified for a publicly funded attorney because he is broke.
Bloomberg dispatched reporters to look into the Dooley’s massive trading losses once became public in late February 2008. Within days, the reporters had a story of a young man who was in financial distress, had alcohol problems, gambling problems and was behind on child support payments. I wondered how the guy was even allowed to be put at a desk risking any money on behalf of a financial firm like MF Global.Read More...
Chameleon John Coupons
6 Dollar Tshirts
Calling for Contributors!Got something to say?
We want to hear from you.
Submit your article contributions and participate in the world's largest independent online news community today!