At a House Financial Services Committee hearing today, former MF Global CFO Christine Serwinski will testify that customer funds were used to cover proprietary bets.

In testimony prepared for a Wednesday hearing, the firm’s former chief financial officer, Christine Serwinski, says she learned that there was “a substantial deficit” in a financial buffer that was supposed to ensure that customer funds were safe.

When she asked why there was a shortfall, she learned that one part of MF Global had borrowed money from another “and had missed the wire deadline to pay it back,” Serwinski says in the testimony.

Such “intraday” lending was not unusual, Serwinski says, “but the loan should have been paid back before” the previous day’s close of business.

This comes on the heels of a treasurer at the company alleging that MF Global CEO Jon Corzine ordered $200 million to be moved from customer accounts to cover a payment to JPMorgan Chase.

Through the tumultuous time when MF Global collapsed, Serwinski was actually on vacation. But she checked in and found out about the buffer deficit, and sought clarity on the issue. By the time she got back to work, she had learned of a customer account shortfall of over $1 billion. Ultimately, $1.6 billion was stolen from customer accounts by MF Global. Nobody has yet been charged in the theft.

As mentioned in other testimony, JPMorgan Chase sought assurances on three separate occasions that MF Global was complying with all regulations regarding customer accounts:

J.P. Morgan three times asked MF Global to sign statements vouching for the propriety of its actions, Laurie Ferber, former general counsel of parent MF Global Holdings, says in testimony submitted for the hearing.

The first and second drafts that the bank asked MF Global to sign were too broad, partly because they encompassed future wire transfers, Ferber says.

The third version referred specifically to a pair of transfers: the movement on Oct. 28 of $200 million from an account for customer funds to an MF Global account, and a subsequent transfer from that MF Global account to another to cover an overdraft, Ferber says.

It doesn’t appear that MF Global ever sent back the drafts. One of their lawyers will testify at the hearing today, scheduled for 2:00pm ET. You can read all the testimony submitted at the hearing mini-page on the site of the House Financial Services Committee.