As much as $1.2 billion or more in customer funds is missing from former New Jersey Gov. Jon Corzine’s bankrupt financial firm MF Global, according to a report on Monday.

Court-appointed bankruptcy trustee James Giddens said in a statement that it is likely $1.2 billion — double previous estimates — is gone from clients accounts, the Associated Press reported. It was earlier reported that about $700 million in customer money couldn’t be found.

The bankers are getting desperate. I have done a bit of research on this story, and apparently there may have been a slight rule change. If you have segregated funds in an account, they may now be borrowed(stolen) if the institution is going to use the funds to bet on sovereign debt. Sovereign debt has always been considered safe so you can see how the bankers managed to get this rule change. I do not think however that Greek sovereign debt would be considered a safe bet, particularly when leveraged 40-1. Make no mistake, John Corzine a former Democratic Governor of New Jersey and ex Goldman Sachs executive will not be prosecuted. He was the heir apparent to Geitners job under a second term Obama administation and is not going to be jailed. The MSM is now already suggesting that he has already been punished by losing his 12million in severence from MF global (the company he destroyed).

This story is big as the rule change will most likely allow the corporate bankers to invest all of the once segregated 401k money that they hold into sovereign debt. You get the picture? If Corzine gets away with this apparent theft IMHO it will let the bankers know they have nothing to fear and it will open the door to more of the same.

http://www.youtube.com/watch?v=wRbQHsk2d5M&feature=related