If it wasn’t clear before, the Commodity Futures Trading Commission's (CFTC) complaint against MF Global, Jon Corzine and Edith O’Brien makes it abundantly clear that this is a case of one man driving an entire firm over the cliff.

I find it odd that other MF Global officials were not named in the complaint as a review of some of  the details indicate that some of those officials who testified along with Corzine in front of Congress—as well as Corzine—may not have been truthful. Equally disturbing is Edith O'Brien's top billing along with Corzine. She was put in that position by more senior officials who conveniently have slid into the shadows.

The most quoted part of the complaint was probably the following: “In another recorded conversation on October 6, the Global Treasurer relayed to Holdings' CFO and another MF Global employee ("Employee #1") that he had told Corzine that the Firm's liquidity "situation" was "not sustainable" and that "the situation is grave." Later during this conversation, the Global Treasurer stated that "we have to tell Jon that enough is enough. We need to take the keys away from him."

The CFO mentioned here refers to Henri Steenkamp, who did not seem to recall anything when he spoke to Congress. How does he fit in here?

Sorry to be repetitive but Corzine held the keys as the Global Treasurer noted above. Corzine made the trades. He made the Chief Risk Officer who tried to limit the sovereign debt position go away. He lobbied the CFTC to maintain rules allowing him to dip into Part 30 Secured Funds. He argued with regulators on the accounting of those trades and its margin.

He also encouraged employees not to be vigilant but rather to walk a compliance tightrope: “October 7, 2011, Corzine remained determined to squeeze the MF Global’s customer segregated accounts and customer secured accounts for cash. In a recorded conversation with another MF Global employee ("Employee #2"), Corzine pronounced: ‘We need to go through what that real number is at the FCM. You know, what's the drop dead amount. ... You know, I'm sure there is a buffer in her thinking. We’ve got to find out what that is so that we have some ability to think about pulling it if we have to.’”

Think about this last comment by Corzine, made on a recorded line. No concern for the customers that are the core part of this business. The only concern is in maintaining his overleveraged position, a position he is so married to that he shows a willingness to risk all else including other people's money and the integrity of his own employees to salvage. Even though these positions are placing the entire firm at risk.

The complaint points out right at the beginning the two most important aspects of this:

“Corzine caused MF Global to make significant investments in various instruments, such as the sovereign debt of certain European countries. Over time, at Corzine's direction, these investments grew substantially and became a material portion of the Firm’s balance sheet, even as the investments grew increasingly risky.”

And

“During the last week of October 2011, in violation of U.S. commodity laws, with virtually no other sources of cash to keep it afloat, MF Global unlawfully used nearly one billion dollars of customer segregated funds to support its own proprietary operations and the operations of its affiliates. Thousands of customers were directly and indirectly harmed by these unlawful acts.”

That is what this is all about. Given those material facts there should be no conceivable way  that Corzine should be able to hide behind any “I didn’t know” or “I never knowingly encouraged” defense regarding other employees causing MF Global to violate segregation rules.

Corzine directed all of this and was responsible for all of this.

The complaint makes the Justice Department’s lack of aggression on a criminal case — according to one report, they didn’t even interview Corzine until July 2012 — look even more disturbing.

I can’t imagine that there won’t be other charges coming out. And I am encouraged the CFTC is demanding a jury trial. It would be another crime if Corzine could settle and accept some punishment without acknowledging guilt. We noted last week in response to reports of possible CFTC charges against Corzine that short of criminal prosecution the CFTC could and should ensure Corzine no longer is in a position to manage other people's money. The CFTC has done their job, albeit a bit tardy, and the details they include make it more perplexing others have not done theirs.