Jon S. Corzine and other former MF Global officials will pay
$64.5 million to settle an investor lawsuit, according to a court
filing.
In a Tuesday filing with the U.S. District Court in Manhattan,
lawyers for former MF Global shareholders led by the Virginia
Retirement System and the Queen of Alberta, Canada, said ex-MF
Chief Executive Mr. Corzine, as well as former finance chief Henri
J. Steenkamp and other former employees, will pay the money in
cash. The settlement is subject to court approval.
A lawyer for Mr. Corzine didn't immediately have comment.
The settlement is the third in the suit by shareholders. Judge
Victor Marrero has already approved their $74.9 million settlement
with a group of underwriters named in the suit, and will soon
decide whether to approve a $65 million settlement with accounting
firm PricewaterhouseCoopers LLP.
In 2013, the judge denied Mr. Corzine's bid to dismiss the suit,
saying it amounted to a claim that "stuff happens," or that the
company's sudden implosion was the "fateful work of supernatural
forces."
The suit accused Mr. Corzine of misleading investors about the
risky bets on European sovereign debt the company made, leading to
its Oct. 31, 2011, bankruptcy filing. Mr. Corzine had called the
lawsuit "jumbled" and said investors weren't misled.
When MF Global collapsed in 2011, after Mr. Corzine's bets on
the debt came to light, a trustee unwinding the company's brokerage
estimated a $1.6 billion shortfall in brokerage-customer
accounts.
Funds have been recovered to satisfy the customer claims, but
the creditors of both the MF Global Inc. brokerage and its parent
won't ever get 100% of their money back.
Unsecured creditors of the MF Global Inc. brokerage have already
received nearly $1 billion after their most recent distribution was
approved by a bankruptcy judge last month.
Mr. Corzine, a former Goldman Sachs chairman and New Jersey
governor, still is facing other lawsuits over the implosion,
including one from the litigation trust representing MF Global's
parent company and one from the U.S. Commodity Futures Trading
Commission. Mr. Corzine and other accused executives have denied
any wrongdoing and have sought dismissals of all the suits.
Write to Joseph Checkler at joseph.checkler@wsj.com
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