first of all, who is terrence duffy, the witness who presented that testimony? and what is cme-global? >> terrence duffy is the ceo of the cme group which is the exchange where mf-global does most or did most of its business. transacted most of its trade. they are also what is called a self-regulating... self-regulatory organization so they're responsible for regulating mf-global and ensuring that they comply with various laws. >> woodruff: what exactly did duffy testify today some. >> it was strange because initially it seemed like a bombshell, like john corzine knew about the misuse of funz but upon further examination it seems that he was merely saying john corzine knew that money had been transferred from customer accounts to another division in the company. that on its surface is not necessarily illegal. there are legal reasons for it. so while it was clear his implication was to say that mr. corzine somehow knew what was going on, it fell short of saying that mr. corzine either authorized the misuse of funds or knew that those funds were being illegally tr

terrence duffy said earlier this week an auditor heard one employee say corzine knew a loan had been made from customer accounts. corzine said money may have been transferred to clear up an overdraft at j.p. morgan. but he insisted the transaction was appropriate. >> the back office in chicago explicitly confirmed to me that the funds were properly transferred. >> reporter: former federal prosecutor jacob frankel was struck by the force of corzine's denial. >> these were absolute, unequivocal denials under oath. and for that reason, i think it is believable, even if people do not want to believe it. >> reporter: brokers like m.f. global can borrow from customer funds in some circumstances, but the loans are strictly controlled, and firms must replace customer cash with u.s. treasury securities or other super-safe investments. some members of congress consider that a loophole. >> you actually could legally, under current... not current, under recently passed rules, basically invade those funds of customers and not break any rules doing so. is that an unfair statement? >> it's not an u

terrence duffy. mr. duffy is the executive chairman for the cme group based out of chicago, illinois. he has been a member of the board since 1995. is president of tba trading from 1981-2000 has been a member of cme since 1981. so welcome to all of you. and for giving her testimony i would ask you to rise and raise your right hand. [witnesses were sworn in] >> thank you. miss summers, would ask you to start her testimony. >> good afternoon, chairman stab in, banking -- ranking member robert ament of the committee. thank you for inviting here today to discuss mf global bankruptcy. i understand the severe hardship this bankruptcy has cost for customers of mf global. these customers correctly understood the risks associated with trading futures and options, but never anticipated that their segregated accounts were at risk suffering losses not associated with trading. many customers have reached out to me and my staff directly and are doing everything we can to get as much of the money back to them as quick

terrence duffy, aasserts at 2:00 a.m. monday, october 31st , mf global informed the cftc and cme that customer money had in fact been transferred to the firm's broker dealer account. did these details match your recollection of what was conveyed to the cftc and cme that monday morning? >> senator, the general description that mr. duffy talked about on the issues of october 31st are consistent. >> okay. to your knowledge, did mf global shift any funds out of the segregated accounts to the broker-dealer side of your business or to pay any outstanding obligations? >> senator, is a said in written testimony and here again this morning, until the evening -- late evening of october 30th i was not aware of the unsegregated funds. >> by your own admission these positions played a major role in the loss of market confidence that led to the failure of the firm in exploring the role these trades played in the collapse omf global, many raised concern over the accounting rules that aloud you to treat it as sales rather than financing,

terrence duffy executive chairman cme group, mr. industry regulatory authority, mr. james kamlin chief counsel for mr. james kitty on bankruptcy trustee for mf global inc. in mr. thomas baxter general counsel federal reserve bank of new york. ministers berkovitz i would remind all of you that your full testimony will be made part of the record and we ask you to summarize your testimony and five minutes. mr. berkovitz you are recognized. >> good afternoon chairman nuegebauer, ranking member capuano and members of the sick and many. thank you for the opportunity to testify. >> mr. berkovitz we have make sure your button is on? >> congressman is that better? >> that is much better. >> good afternoon. the commission's highest priority at this time is returning money to mf global customers as quickly as possible. we are working around-the-clock to determine what happened to and locate all of the customer funds. the mf global bankruptcy trustee with the assistance of the cftc, has transferred nearly all of positions of customers trading o