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- White House Now Doesn’t Dispute Details of Trump's Call with Army Widow
- Goldman Sachs’ Lloyd Blankfein Just Threw Some Serious Brexit Shade
- Guggenheim Partners ‘Bank Wrecker’ Could Get $100Mn Exit Package
- Proposed Arbitration Rule Change: For Customers Dealing with an Inactive Firm or Associated Person
- This Family Bet It All on Bitcoin
- Clearinghouses Pass CFTC Liquidity Stress Tests
- President Trump Admits He’s Trying to Kill Obamacare. That’s Illegal.
- Trump Plunges Down List of ‘America’s Richest’
- Is Trump’s “Foreclosure King” in Over His Head?
- FBI Arrests NCAA Basketball Coaches and Adidas Rep in Bribery Probe Involving Recruitment
- Equifax CEO Steps Down Amid Hacking Scandal
- Litigation Costs to Rub Salt in RBS Investor Wounds
- RIAs Poised to Land Wirehouse Recruits - Dan Jamieson
- Citibank and U.K. Affiliate to Pay $550K Penalty for Swap Data Reporting Violations - CFTC
- AIG to Restructure into 3 New Units, Marking CEO's First Big Move
- Accounting Firm Deloitte Says It Suffered Cyberattack (subsc reqd)
- Upcoming FINRA Board Meeting and FINRA360 Update
- Elizabeth Warren Lifts Hold on Trump DOJ Antitrust Nominee
- Bigger Mergers Narrow Indy Reps' Options, Alter IBD Channel - Dan Jamieson
- Dentons to Merge with U.K.'s Murray & Spens
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PricewaterhouseCoopers vs. Jon Corzine – Who’s Truthful? Who’s Right?
[Photo: by Jefferson Siegel / NY Daily News]
The malpractice case against PricewaterhouseCoopers, or PwC, has completed 2 days of testimony. Jon Corzine, the former Chairman and CEO of MF Global, has been under heavy cross-examination from James Cusick, the lawyer representing PwC.
Corzine never wavered from his assertion that the collapse of MF Global, which happened under his stewardship, had nothing to do with the financial health of MF Global. Corzine professed that he had not been overly worried about the firm’s credit rating, even as Mr. Cusick rattled off some 99 financial issues that Moody’s factored into its downgrade of MF Global.
While Corzine never blamed PwC directly, he testified that he and his team relied “on the advice they were receiving and I was receiving, from our outside public accountants.” Corzine did specifically note that PwC's decision to change its advice on accounting for "deferred tax assets," and MF Global's decision to reveal more than PwC had required about the European debt to calm jittery markets, prompted "confusion" and a "loss of confidence and trust."
That Euro debt would refer principally to Corzine's $6.3 billion bet on sovereign debt from 5 European countries, which spooked nervous markets after a recent near-shutdown of the U.S. government.
So, while we wait for testimony to play out in this Manhattan federal courtroom, we look for any indications of definitive proof that establishes PwC’s advisory role as having played a significant and integral role in the timing of the financial troubles that ultimately upended MF Global.
It will be interesting to see if, during the course of this 5-week trial, testimony comes out about other aspects of MF Global’s 2011-2012 melodrama:
- e.g., MF Global’s misuse of $1 billion of customer funds that should have been securely segregated, but which the firm used as collateral for its undermargined positions.