A farmer’s son who bet the bank and lost

IT WAS often said that Jon Corzine wanted to turn MF Global into a mini-Goldman Sachs. Now, however, this failed politician will be remembered as the man who was in charge when the broker went bust so spectacularly.

It marks an ignominious end to the son of an Illinois farmer, to say nothing of the damage wreaked on the firm, which was crippled by its exposure to European sovereign debt.

The roots of MF Global go back more than 200 years, to a sugar brokerage in London, and in 2011 it could boast of being a “well-capitalised global franchise” operating in 70 nations.

Those claims were shattered yesterday, however, when staff in New York were prevented from doing deals and colleagues in Chicago left the trading floor before the session opened.

The group posted a net interest income of $287m (£178.5m) for the year to March, down 60 per cent on three years earlier, as ultra-low US rates hit commissions from traders.

Corzine, a former Democratic governor of New Jersey who failed to win a second term before joining MF Global in March 2010, did not start the group’s decline but hastened it by transforming it from a risk-averse futures broker to an investment bank that bet on the swings of the market.

In a newspaper interview three weeks ago Corzine said his business was “on track”. With hindsight, it will be seen as running off the rails.

HOW THE BANKRUPTCY OF MF GLOBAL COMPARES
MF GLOBAL'S filing is the eighth largest US bankrupcty in the past 30 years, according to figures from bankruptcydata.com.

The following is a list of large US bankruptcies since 1980, according to court records and the website bankruptcydata.com.