In Greece they’re going back to the days of direct democracy with a referendum on the debt-relief-for-austerity deal. Here in the US, we’re reliving some ancient history too – specifically, 2008. Jon Corzine’s MF Global just engaged in a Lehman-like crash. One annoying detail: they appear to have stolen customer money in the process:

Federal regulators have discovered that hundreds of millions of dollars in customer money has gone missing from MF Global in recent days, prompting an investigation into the brokerage firm, which is run by Jon S. Corzine, the former New Jersey governor, several people briefed on the matter said on Monday.

The recognition that money was missing scuttled at the 11th hour an agreement to sell a major part of MF Global to a rival brokerage firm. MF Global had staked its survival on completing the deal. Instead, the New York-based firm filed for bankruptcy on Monday.

Regulators are examining whether MF Global diverted some customer funds to support its own trades as the firm teetered on the brink of collapse.

This could just be bad bookkeeping, but more likely it’s the result of intermingling of the customer funds and MF Global’s own account, precisely what would be banned by the reintroduction of Glass-Steagall. As it is, MF Global, a brokerage firm and not a bank, is under investigation. The whole point of a brokerage firm is to manage money for others, not to “borrow” the funds to make risky bets in the company’s account.

Hilariously, Corzine was trying to make his comeback on Wall Street after losing the Governor’s mansion in New Jersey by investing in debt holdings from Spain, Italy, Portugal, Belgium and Ireland. He did get them at a premium discount, which is nice, but investing in European debt back then now looks like investing in Titanic futures. And this was an enormous amount of risk for a relatively uncapitalized firm. When the EU announced their haircut on Greek debt of 50%, raising the risk that there would be major haircuts for the rest of the periphery, investors looked at MF Global’s balance sheet and ran screaming in the other direction.

Corzine was only in charge of MF Global for 18 months before basically losing the firm in a bet. Corzine himself already pocketed millions during his tenure, since compensation at MF Global was a whopping 64% of revenues. But he did lose his golden parachute by failing to sell the business before it filed for bankruptcy, and he didn’t get a bailout. And this allegation of missing customer funds will dog him and his company in court.

More from Yves Smith.