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- Canada's CIBC Completes $5Bn PrivateBancorp Buy
- Word ‘Women’ Literally Never Appears in U.S. Senate’s 142-Page Health-Care Bill
- Stephen Pierce, Goldman Sachs Global Head of Equity Markets, To Retire
- Al Gore 'Not Very Smart,’ But Became Filthy Rich Using Simple Investing Formula - Charlie Munger
- U.S. Regulators, Lawmakers Support Volcker Rule Revamp at Hearing
- Morgan Stanley Opts for Frankfurt as New EU Hub
- A New Risk for Goldman, Morgan Stanley in Stress Tests (subsc reqd)
- A Trump Bump for Law Firm of President’s Lawyer - Kasowitz Benson Torres
- JPMorgan, BofA, Goldman, Citi, Wells Fargo Pass Fed's Stress Test
- Blackstone Stock Still Trading at $31 - Its IPO Price From 10 Years Ago
- NJ Resident and NY-Based Global FX Club Charged with Solicitation Fraud, Misappropriation - CFTC
- Senate Republicans Release Plan to Replace Obamacare - The Details
- Berkshire Hathaway Throws $1.5Bn Lifeline to Canada's Home Capital
- Inside Nomura: Day in the Life of a Junior Banker
- Inside Travis Kalanick’s Resignation as Uber’s C.E.O.
- Creative Planning, KS Investment Firm, Spurring Change on Wall Street
- SEC Obtains Judgment Against Attorney Who Defrauded Escrow Clients
- SEC Files Fraud Charges Against Stock Promoters in Market Manipulation Scheme
- Power Lunches and Dinners in New York, London, Washington
- Banks to Cut $1.2Bn in Research Spending, Analyst Jobs - McKinsey
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NEWSLETTERS & ALERTS
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.