Making it to the top of Goldman Sachs brings wealth, prestige -- and apparently a waiver from Finra from taking the broker exams it regularly requires of others in the securities industry.
The Financial Industry Regulatory Authority Inc. gave former U.S. senator and New Jersey Gov. Jon Corzine a pass from taking the Series 24 and Series 7 exams when he returned to the financial sector to head the now-bankrupt MF Global Inc. in 2010 after an 11-year break from the industry. After such a gap, Finra normally requires brokers to take these exams. The agency did require Mr. Corzine to take the Series 32 futures exam.
The fact that Mr. Corzine didn't have to requalify for registration probably didn't make a difference in the firm's recent collapse, costing 1,066 employees their jobs. But the perception of special treatment riles some advisers.
Crony socialism at work, folks. The favored few get what you and I could never get. As Orwell correctly noted, all of us are equal, but a few of us are more equal.
"There should be no favoritism or cronyism within the securities industry," Nigel Taylor, owner of Taylor & Associates, wrote in an e-mail. "It's corrupt enough at the top already, as recent enforcement actions against brokers, fee-only planners and insider traders have illustrated."
And that's just the way the insiders want it...
Mr. Corzine worked on Wall Street for 24 years, capping his career by serving as co-chairman and chief executive of Goldman Sachs & Co. He left the firm in 1999 and was elected to a U.S. Senate seat from New Jersey in 2000. He was elected governor in 2005.
He made sure Goldman Sachs was a key contributor to the Obama campaign in 2008. Then he ran New Jersey into the ground. Now he's bankrupted a major brokerage.
After he was defeated for re-election in 2009 by current New Jersey Gov. Chris Christie, Mr. Corzine joined MF Global. Finra says on its website that investment professionals must retake exams after being out of the business for more than two years.
One compliance consultant speculated that Mr. Corzine used his Finra connections to obtain his waivers. He had served on the board of NASD, which later became Finra.
"It can only be surmised that due to his former position on the board of governors, he was able to pull strings not available to the rest of us," said Brian Hamburger, managing director of MarketCounsel.
A lawyer for Mr. Corzine did not return a call for comment.
Don't hold your breath...
Finra spokeswoman Nancy Condon denied last week that Mr. Corzine received special treatment, saying Finra grants a large number of exemptions each year. So far this year, Finra has approved 1,556 waivers, while denying 1,333 others, according to Ms. Condon. She did not supply the total number of exams administered.
Why would anyone get a waiver? 1500 plus waivers is a lot. Why is Finra handing them out? Isn't the whole point of Finra to make sure that people understand the law and the securities rules?
The Securities and Exchange Commission, which regulates Finra, did not respond to a request for comment.
Finra is not the only regulator that grants waivers. For instance, nearly every state exempts certified financial planners from the Series 65 licensing exam and allows other exceptions, too.
"It's a pretty standard practice," said Steven Thomas, director of Lexington Compliance and former chief compliance examiner in the South Dakota Division of Securities. "In a lot of cases, it's justified. [But] there would be no justification on why [Mr. Corzine] should get a waiver."
Ms. Condon said that the same standard applies to everyone seeking to skip exams.
"Each request for a waiver is reviewed and considered against the detailed criteria posted on Finra.org," Ms. Condon wrote in an e-mail. "It includes general experience, education and regulatory or legal experience."
If a person has the experience and education, have them take the exam anyway -- that person should ace it, right? The whole unspoken point of waivers is to let people get in on the inside -- to do favors, and to receive favors in return.
Before his sojourn into politics, Mr. Corzine spent his career in the financial industry. After working at a regional bank in Ohio, he joined Goldman Sachs in 1975 as a bond trader. He worked his way up to co-chairman and chief executive in 1994, serving until 1999.
During his time in government, Mr. Corzine was not completely separated from financial industry matters.
Of course not; that was the point of his being a senator.
"On the [Senate] Banking Committee, he worked on what became the Sarbanes-Oxley Act of 2003," states a biographical sketch in the Almanac of American Politics.
As governor, of course, he had ultimate responsibility for New Jersey's Bureau of Securities.
But Mr. Thomas argues that Mr. Corzine's government service didn't expose him to the rapidly changing environment of financial regulations.
David Tittsworth, executive director of the Investment Adviser Association, said that Mr. Corzine probably would have passed his exams if he had been required to take them.
So why not have him take the exam?
Those credentials, however, don't guarantee ethical behavior.
"As far as I know, Bernie Madoff passed the Series 7 examination," Mr. Tittsworth wrote in an e-mail. "He was chairman of Nasdaq, and his family held various roles at Finra/NASD. None of those factors stopped him from perpetrating fraud. Instead, all of those factors lent credibility to his resume."
Observers agree that Mr. Corzine's exam waivers probably had no effect on MF Global's collapse, which was caused by vast overleverage in European sovereign debt.
Posted by: Steve White ||
11/13/2011 11:09 ||
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All 1,066 employees of the bankrupt trading house MF Global got the boot yesterday in a pre-holiday massacre that left workers without severance and benefits -- and they blamed only one man for their woes.
"Happy holidays, Corzine, from all your employees who've been fired without severance packages!" a worker fumed at her former company CEO as she left the firm's building at 717 Fifth Ave.
"I have two little kids, it's almost Christmas, the economy stinks -- how am I gonna find a job?" said another worker who just cleaned out his desk.
The 1,066 employees will be paid through next Tuesday, and health benefits will run out at the end of November. Bonuses and other financial perks won't be paid, workers said.
"It ended like this because of one man," said Anthony DiMatteo, who worked for MF for 16 years. Corzine is "selfish, greedy," he said.
If Corzine were around, DiMatteo told Bloomberg News, "I would punch him in the face."
Another expressed his fury by donning a T-shirt that read: "F--k you, you f--kin' f--k!"
Any of you folks bother to challenge him before he ran the company into the ground? Anyone go to the board of directors? No? Sorry, no sympathy from me.
The pink slips -- which went out in New York, Chicago and other MF offices -- were court-mandated in the wake of the Oct. 31 Chapter 11 filing of its parent firm, MF Global Holdings Ltd. The $41 billion firm collapsed after Corzine's disastrous high-stakes investment in foreign debt blew up in his face.
The former New Jersey governor and Goldman Sachs chief took the helm at the venerable trading firm in 2010. He resigned last week, saying he would not seek about $12 million in severance.
Yesterday, his furious former troops blamed the onetime financial rainmaker for playing fast and loose with their livelihoods.
"Corzine went to the blackjack table and took a 100 percent bet," said Pierre Yvan Desparois, a credit department vice president who worked at MF Global for 3 1/2 years. "He placed bets with people's lives."
"Anybody coming out of grad school could have told him not to make those bets," said Desparois.
And, though he figured the layoffs were coming, Desparois said he wonders, "How long can I survive?"
"Corzine screwed up really well, and put a lot of people in uncomfortable positions. The lives of so many people have been disrupted."
The firings did not apply to MF's parent company, which has about 2,800 employees.
Bankruptcy trustee James Giddens is still trying to find about $600 million in missing customer money. Forensic probers are trying to account for the brokerage firm's assets, and federal agencies are investigating whether MF mixed company funds with money missing from customer accounts. Giddens said about 150 to 200 MF brokerage employees will be hired back to assist in the "wind-down" of the business.
Corzine could not be reached for comment.
Posted by: Steve White ||
11/13/2011 11:04 ||
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Any of you folks bother to challenge him before he ran the company into the ground?
Of course not! If you want to keep your job, never challenge the big cheese! If the big cheese f--ks up, that's a horse of a different color.
A company controlled by a longtime political donor gets a no-bid contract to supply an experimental remedy for a threat that may not exist.
Posted by: Fred ||
11/13/2011 00:00 ||
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#1
Doling out of favors to big contributors for this sort of thing, and I guarantee none of the OWS crowd will protest at Perelman's homes and the MSM amd NPR will not even mention this.
We're on our own, folks.
Posted by: no mo uro ||
11/13/2011 8:13 Comments ||
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#2
Oh, please at least we are getting something for our half a billion. And smallpox is bad.
I don't understand why the white house went to the mat to get solyndra loan money, when they could have just bought their stuff. Then at least they could point to some solar cells on some buildings, instead of nothing.
In this case they will have something, and some people (like me) will value that something even if it was expensive.
#3
I don't understand why the white house went to the mat to get solyndra loan money, when they could have just bought their stuff.
Really? You don't understand! It is called GRAFT. What percentage of those loan guarantees found their way back into Obama and crews pockets?
Posted by: Secret Asian Man ||
11/13/2011 9:35 Comments ||
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That would have made Solyndra go bankrupt even sooner. Solyndra's costs were twice what they were getting for the product. By "loaning" taxpayer money and illegally subordinating government claims behind those of investors, it was a pure payoff to make politically connected investors whole while foisting the cost bankruptcy upon taxpayers.
I'm looking forward to a lot of folks (Solyndra and gov) going to jail for their theft of vast amounts of tax dollars. Unfortunately, I think the governing class is too far gone down the path of corruption, no matter which party is in power.
#5
What we are getting for Zero's $433 billion is an untested and untestable remedy for a possible terror attack that we already have a proven prophylactic for.
How much would you as a taxpayer be personally willing for fork over for that [and here imagine I am now passing my hat for the collection of same.]
As long as you are getting YOUR pink pony, corruption is fine and dandy.
You able to sleep with that conscience?
Posted by: no mo uro ||
11/13/2011 11:01 Comments ||
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I have returned after a couple of hours and have found that my hat is still empty. Is no one willing to contribute to this boondoogle? Cheap b******s!
#8
The company that got the small pox therapy award is a legit company that has been in biz for quite a while. The company hit $14 a share when the award was announced many months ago but sunk to about $3 a share when the Administration delayed and delayed execution of the award (because it is a reimbursement basis contract). The delay required the company to undertake a variety of difficult financing actions that depressed the income statement, cash flow, etc.
Because of the delay, it is reasonable to criticize Obama for hurting the company rather than helping it.
Posted by: Lord Garth ||
11/13/2011 16:55 Comments ||
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I have nothing to gain from this contract being awarded to any specific company. Nor would I likely benefit from the availability of the vaccine in the future, having already been vaccinated against this particular disease. Further, I am happy to entertain criticism for the award to this company in particular.
However, smallpox is bad; it has been weaponized in the past; there are lots of unvaccinated people in the U.S. Therefore, this contract should be awarded to someone to make a stockpile of the vaccine to be able to protect our younger citizens.
That 0 finally got this done is a good thing, and that he awarded the contract to one of his buddies is probably unavoidable. I bet every company qualified to do the work has a guy on the board whose job is to be the big donor to Democrats and another whose job it is to be the big donor to Republicans.
Like I said above, at least we got something for our $$, instead of nothing.
#10
The company that received the boodle may indeed be legitimate. Nothing about the drug they purport to offer, however, seems legit. Some MDs who have expertise in smallpox have gone on record saying it's a waste of time and money.
My hat is still empty. None has contributed a penny.
President Obama said that the United States has gotten a "little bit lazy" when it comes to bringing in new businesses in to the states. He made the comments at a CEO summit as part of the APEC conference Saturday, when asked by Boeing CEO James McNerney about looking at the world from a Chinese perspective and what they might consider as impediments to investing. "you proles aren't working hard enough"
Obama said it's important to remember that the U.S. is still the largest receiver of Chinese loans foreign investment in the world and things like stability, openness and innovative free market culture are attractive. He also said there are a lot of things that make foreign investors see the U.S. as a great opportunity - like stability, openness, our innovative free market culture.
"But we've been a little bit lazy, I think, over the last couple of decades. We've kind of taken for granted -- well, people will want to come here and we aren't out there hungry, selling America and trying to attract new business into America, Obama said. If the NLRB approves of it
He then went on to say things his administration has done like setting up Select USA that organizes government agencies in an attempt to make it easier for foreign investors to set up a plant in the U.S. as long as it's a Union Shop
Posted by: Frank G ||
11/13/2011 12:58 ||
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We've also gotten inexcusably lazy picking our leaders.
#3
Look in the mirror, O. If you see a reflection, then that reflection is the cause of the loss of confidence of business people to invest in new business.
If no reflection, then there is a vampire loose somewhere sucking out the life blood of the nation.
Posted by: Alaska Paul ||
11/13/2011 14:42 Comments ||
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So says the dip$hit who has set a Presidential record for vacations and golf.....
#6
Huh? Investor confidence tanked in October 2008. Obama has done nothing to restore same. However, unless real solutions are posed, he could weasel himself back in.
Ohio was half-red/half-blue; now it is 90% blue. Unions who gouge unearned pension benefits were able to swamp the Limbaugh-Beck regurgitate. Why is President-Catastrophe still in a position of strength?
#7
Translation: "holy crap. I am just now figuring out that all the wealth I planned to redistribute does not grow on trees. Why didn't they mention that in my senior seminar on Social Justice?! Or maybe it did, one of those days I was out, heh, smokin ganjaweed. Oops. We Americans sure are lazy!"
#8
O can say the most infuriating things. Lazy? He should try to make a living with his economic insights! Let me explain, O, not everyone has a friend at the Whitehouse to give them a 500 million dollar deal to ride out this mess.
#9
President Obama said that the United States has gotten a "little bit lazy" when it comes to bringing in new businesses in to the states.
WTF? Does that make it an advertising problem?
The government has been working very hard at screwing things up. Carefully covering their tracks and a$$es.
Leave the people alone and things work fine.
Last time I checked, entrepreneurs were very careful about starting businesses. Prospective business hosts don't have to do anything, entrepreneurs will come to them.
Try again, Obean. We're not so stupid as to believe this, even though you would like to think we are.
It's important to remember that the official poverty rate came about largely by happenstance and was not the result of a carefully thought through analysis. An economist named Mollie Orshansky at the Social Security Administration made the first estimate of the poverty rate in 1963. Ms. Orshansky, who died in 2007, had some data from the Department of Agriculture on food budgets for families of different sizes and incomes. She saw that food constituted about a third of spending by poor families and thus assumed that three times the budget for food would approximate the poverty rate.
This back of the envelope calculation was seized upon by the White House under Lyndon Johnson, which turned Orshansky's figure into the official measure of poverty. Since that time, the original poverty measure of $3,000 for a family of four has simply been increased by the rate of inflation. In 2010, the official poverty threshold for a family of four (two adults and two children) was $22,113. Three bullets from each point of view, some proposals, and the conclusion if the definition were adjusted:
There are fewer poor people under age 18 and more over age 65.
There are fewer blacks in poverty and more of Asian descent.
There are more poor people living in urban areas and fewer in rural areas.
There are more poor people in the Northeast and West and fewer in the Midwest and South.
Such results clearly have political implications that go beyond a simplistic left-right divide. Insofar as the federal government will probably be spending less on poverty reduction in coming years, as deficit reduction measures are implemented, it will be more important to target increasingly limited government resources more efficiently. Reprogramming federal programs to aid those most in need while scaling back benefits to those that may be relatively well off will limit the impact of aid cuts that probably cannot be avoided. This is the best reason to have a more accurate measure of poverty. Except that the fact that these resources may be trimmed is not the only reason to be more efficient. Too bad we didn't have this discussion 20 years ago. I wonder if government could be made more efficient in any other programs? [snort]
Posted by: Bobby ||
11/13/2011 10:29 ||
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There are fewer poor people under age 18 and more over age 65
On the other hand, those over 65 hold more net worth than those under 18. So if you're going to play the 'redistribution' game, use the old advice about why people rob banks - because that's were the money is. Meanwhile the older group who actually have the vote continue to insist that the younger group subsidize them.
#2
> Reprogramming federal programs to aid those most in need while scaling back benefits to those that may be relatively well off will limit the impact of aid cuts that probably cannot be avoided
A very bad idea. This is almost the definition of subsidising Moral hazard. If you're not eligible for benefits, you shouldn't have to pay for them.
#3
If you're not eligible for benefits, you shouldn't have to pay for them. Our only alternative seems to be going full Amish. Minus the terrorist beard-cutting, of course.
A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
Making it to the top of Goldman Sachs brings wealth, prestige -- and apparently a waiver from Finra from taking the broker exams it regularly requires of others in the securities industry.
A company controlled by a longtime political donor gets a no-bid contract to supply an experimental remedy for a threat that may not exist.
President Obama said that the United States has gotten a "little bit lazy" when it comes to bringing in new businesses in to the states. He made the comments at a CEO summit as part of the APEC conference Saturday, when asked by Boeing CEO James McNerney about looking at the world from a Chinese perspective and what they might consider as impediments to investing.
