U.S. Commodity Futures Trading Commission Chairman Gary Gensler should recuse himself from matters related to MF Global Holdings Ltd. because of his ties to Jon Corzine, the bankrupt firm’s former chief executive officer, Senator Charles Grassley said in a statement.
“MF Global’s case is a big collapse that requires a lot of work from the commission to try to figure out what went wrong,” Grassley, an Iowa Republican, said in the statement released today. “It’s hard to see how the commission chairman could be completely objective in looking out for wronged investors when he has such strong ties to the principal of the failed firm.”
Grassley’s statement cited media reports outlining “close, longstanding ties” between the two men, dating from their work at Goldman Sachs Group Inc. and in Congress, where Corzine was a senator and Gensler was a staff member.
Corzine, who joined MF Global 20 months ago to transform the futures broker into an investment bank, quit today amid regulatory probes after the firm filed the eighth-largest bankruptcy in U.S. history on Oct. 31.
Stephanie Allen, a CFTC spokeswoman, didn’t immediately respond to a request for comment.