NEW YORK ( TheStreet) -- Jon Corzine was a high stakes gambler who pushed MF Global ( MFGLQ.PK) to take more risk but had the rug pulled out from under him by regulators and ratings agencies. That, at least, is the impression one gets after reading the latest journalistic investigation into the firm's collapse, courtesy of The New York Times. Monday's front page story in that newspaper does not take a clear position on whether the regulators and ratings agencies were justified in pulling the plug on MF Global. On the one hand, the article reports that Corzine "compulsively traded for the firm on his BlackBerry during meetings," and describes him jetting down to Washington to lobby a top Securities and Exchange Commission official.
On the other hand, the account points out that the now-notorious $6.3 billion in European debt trades that led to a conflict with regulators and a fatal downgrade from Moody's Investors Service ( MCO) ended up making a profit. An argument might be made that overzealous regulators and ratings agencies brought down MF Global. An argument might also be made that MF Global was brought down by confusion around what is an appropriate level of risk in the wake of the 2008 crisis, leading to crossed signals between MF Global, its auditors, its regulators and the ratings agencies, and probably within those institutions as well. What remains to be determined, however, is how exactly--in MF Global's desperate search for cash to cover its risky bets--customer funds were mingled with those of the company. It is more likely that regulators and law enforcement officials--rather than journalists--will be first to put that puzzle together. If hubris by itself were a crime, Corzine would already be on his way to minimum-security prison. Fortunately for him and for all of us, far more evidence is needed than we have to date. -- Written by Dan Freed in New York.