Former MF Global chief Jon Corzine apologised to customers, employees and investors who have suffered because of the brokerage firm's collapse, but said he does not know where missing customer money is.
Their plight weighs on my mind every day -- every hour, Corzine said in lengthy remarks prepared for delivery on Thursday before a hearing of the U.S. House of Representatives Agriculture Committee.
I simply do not know where the money is, or why the accounts have not been reconciled to date, he said.
In separate testimony, a top executive of futures exchange operator CME Group Inc
Transfers of customer funds for the benefit of the firm constitute serious violations of our rules and of the Commodity Exchange Act, CME Executive Chairman Terrence Duffy said in prepared remarks.
CME, the biggest U.S. futures exchange operator, was a hands-on regulator of MF Global. Duffy said the brokerage admitted during a call with regulators that customer money was transferred out of segregation to the firm's own accounts.
MF Global collapsed in late October after it was forced to reveal that it had made a $6.3 billion (4 billion pound) bet on European sovereign debt.
The court-appointed trustee has estimated the shortfall of customer money at $1.2 billion, but CME has disputed that figure as being too high. In his prepared testimony, Duffy indicated the shortfall was roughly half that amount.
Nine witnesses are scheduled at the hearing, but Corzine, a former governor of New Jersey, is the star. He is breaking his silence for the first time since MF Global's October 31 bankruptcy and his resignation days later.
Neither MF Global nor any of its executives has been charged with wrongdoing, but the failure of the firm -- which froze the money of thousands of customers -- has attracted the attention of the FBI and federal prosecutors.
Corzine said he believes it is appropriate for him to attempt to respond to lawmakers' questions on Thursday, but said he may be unable to answer certain inquiries because he had limited access to documents since he left the firm.
He also distanced himself from some hands-on aspects of the firm's business practices.
Even when I was at MF Global, my involvement in the firm's clearing, settlement and payment mechanisms and accounting was limited, Corzine said.
He did say he accepts responsibility for the repo-to-maturity trades that related to the firm's European sovereign debt exposure.
At the time that MF Global entered into the transactions, I believed that its investments in short-term European debt securities were prudent, he said.
(Reporting by Sarah N. Lynch in Washington and Ann Saphir in Chicago, writing by Karey Wutkowski; editing by John Wallace)