That came from an e-mailsent to S & P a week before MF Global went belly-up.
A week before MF Global Holdings Ltd. collapsed, its chief financial officer told Standard & Poor’s in an e-mail that the futures broker had “never been stronger.”
S&P provided the House Financial Services Subcommittee on Oversight and Investigations with an excerpt of the e-mail from MF Global CFO Henri Steenkamp. S&P also informed the panel that Jon Corzine, then MF Global’s chief executive officer, met with its analysts on Oct. 20 to reassure them that his $6.3 billion bet on European sovereign debt was no threat to the firm, according to a Jan. 17 letter obtained by Bloomberg News.
U.S. lawmakers will turn their attention to the role of the ratings companies in the failure of MF Global at a Feb. 2 hearing after summoning Corzine, the former governor of New Jerseyand Goldman Sachs Group Inc. co-chairman, to two hearings in December. S&P ranked MF Global as investment grade until its failure, while Moody’s downgraded it to junk status four days earlier.
You know what we need? Regulations to prevent things like this from happening. What's that? There are already regulations in place?
Regulators are considering how to implement portions of the Dodd-Frank financial regulation overhaul that instruct them to remove credit ratings from rules. Lawmakers may push for a stricter interpretation of the law after the MF Global hearing, Atorino said.
MF Global, which had been building its European positions since June 2010, first disclosed them in regulatory filings last May, according to a memoby the subcommittee’s staff dated Jan. 27. Ross, the lawyer for Moody’s, said in the letter that “nothing stood out” in those filings for its analysts. Parmelee didn’t say how S&P’s analysts reacted to the disclosure in his letter.
Huh. So regulations and rules already existed, yet somehow this one was able to slip through the cracks? How can that be? It's almost as if someone that wanted to circumvent the regulators somehow found a way to do that.
Imagine that.
Criminals will always find a way to break the law, regardless of how many rules, regulations, and laws are put into place.
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