Former MF Global CEO Jon Corzine faces an uphill battle if he ever wants to trade in the futures market again. At its quarterly meeting of board directors, the National Futures Association (NFA) discussed imposing on him a lifetime ban on trading in the futures markets.
Although the board did not immediately impose such a ban, Christopher Hehmeyer, chairman of NFA, said, “The Board notes that Mr. Corzine is not currently a member of NFA. The Board is aware of publicly available information that raises issues concerning Mr. Corzine's fitness for NFA membership. If Mr. Corzine applies for membership in the future, he will not be granted membership unless NFA, after completing its fitness investigation, resolves those issues to its satisfaction.”
John Roe and James Koutoulas, both of whom were elected to the NFA board in January, brought the motion to ban Corzine to today’s board meeting. Additionally, the two men founded the Commodity Customer Coalition following the collapse of MF Global and have been lobbying actively for the return of customer funds. The proposal to ban Corzine is their first action as NFA board members.
Corzine has been under close scrutiny for his role as CEO when MF Global declared bankruptcy on Oct. 31, 2011. The broker’s downfall led to probes by a number of regulatory probes and Congressional hearings after it was revealed the firm had improperly used approximately $1.6 billion of customer funds. Currently, about 93% of U.S. customers’ funds have been returned.
Among the ongoing probes is one by the Department of Justice, although no charges currently have been filed.
Referencing the number of investigations currently ongoing, Hehmeyer continued in the post-meeting statement saying, “Once the appropriate agencies have completed their investigations, NFA has the authority to bring disciplinary action against Mr. Corzine for violations of any NFA rules that occurred while he was a member. The sanctions for disciplinary actions could include a lifetime ban and significant monetary fines."
According to some reports, Corzine had been considering launching his own hedge fund.
“He doesn’t need to be near anyone’s money ever again in the futures space, and we want to make sure of it,” Roe told the New York Post before the meeting.