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Corzine Deemed MF Global Risk Concerns Implausible, Roseman Says

February 01, 2012

Feb. 1 (Bloomberg) -- Concerns over liquidity risk posed by MF Global Holdings Ltd.’s European debt positions in October 2010 were deemed “implausible” by then-Chief Executive Officer Jon S. Corzine, according to his former top risk officer.

“I discussed my concerns about the positions and the risk scenarios with Mr. Corzine and others,” Michael Roseman, MF Global’s chief risk officer until January 2011, said in testimony prepared for a House hearing tomorrow. “The risk scenarios I presented were challenged as being implausible.”

Roseman laid out his concerns when he was asked to make a presentation to MF Global’s board on a request to increase the total sovereign debt limit to $4.75 billion, he said in his remarks, which were prepared for a Financial Services investigations subcommittee hearing on the firm’s risk management practices.

MF Global filed for the eighth-biggest bankruptcy in U.S. history on Oct. 31 after receiving margin calls and other demands for money amid escalating concern that the brokerage wouldn’t have enough capital to cover its European bets.

--Editors: Gregory Mott, Maura Reynolds

To contact the reporter on this story: Phil Mattingly in Washington at

To contact the editor responsible for this story: Maura Reynolds at

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