Attorney for Ex-MF Global Employees: Former Gov. Corzine Lied Before Company Went Bankrupt

Misled on MF Global?

Inside former employees' lawsuit against former governor Corzine, executives over brokerage firm's collapse and lost billions

This is a rush transcript from "On the Record," December 7, 2011. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Did Jon Corzine lie? Former MF Global workers say former New Jersey Governor Jon Corzine and other executives misled them, a polite way to say lie, and lured them into putting their savings into company stock, a company they knew was in deep trouble. Now two of those co-workers are suing the executives. Jacob Zamansky, the attorney for the former MF Global workers, joins us. Good evening, sir.

JACOB ZAMANSKY, ATTORNEY FOR FORMER MF GLOBAL WORKERS: Good evening to you.

VAN SUSTEREN: You represent two employees, at least right now, and you expect to expand it to more employees. But what is their claim?

ZAMANSKY: Right. We are going to try to represent a class of 3,000 employees of MF Global in the United States and abroad. And the claim is that Jon Corzine and the board of directors breached their fiduciary duties to these employees. They encouraged them to put their retirement savings and most of their pay in company stock. He misled them about the financial condition of the company, blew up the company with a $6 billion risky bet on European sovereign debt. Now their retirement savings, their employment is up in smoke.

VAN SUSTEREN: There are a couple issues. Number one is these employees are out of money and feel they have been wronged by Jon Corzine and the company and others. But you also have people who had money invested in the company that was squandered or lost or whatever by the company. Do you in anyway contend that your employees would be head of these customers when everything is sorted out, because there's not a lot of money there, not everyone is going to get satisfied.

Do you clients come ahead of the customers who lost money in MF Global or before?

ZAMANSKY: Well, we are in federal court in the southern district of New York. The customers are in bankruptcy. There's a trustee who is appointed to try to locate their money and trace it. It may be at JP Morgan and other banks. We are separate and apart from that. Corzine personally is responsible, as is the board of directors. So we are going to go after them personally. The man is worth hundreds of millions of dollars. He's the one that called the shots and took this bet. There's insurance coverage for this. So we are going after the individuals personally separate and apart from the customers.

VAN SUSTEREN: All right, so it's an entirely different pot. It's not the pot, the value of the company, but to go after those personally and not the company?

ZAMANSKY: Right. MF Global is in bankruptcy, there's a trustee, and that's separate and apart. It's actually a few blocks away from the courthouse that we are talking about so it's completely separate and apart.

VAN SUSTEREN: Has former Senator Jon Corzine said anything yet or has he gone dark since the October 31st bankruptcy filing?

ZAMANSKY: Corzine is AWOL. He has been subpoenaed to the House of Representatives, supposed to be there tomorrow. If he shows up I assume he will take the fifth. This is a guy who, senator, governor, former head of Goldman Sachs, went to a company that was a leading commodities broker, thought he would make it in the next major investment bank. He bet the farm on this European sovereign debt. It's all gone Jon Corzine, we will be looking at his personal assets and make him accountable.

VAN SUSTEREN: But there's a big difference between being a bad company guy, a bad investor or an accident or whatever and being deceitful and misleading and hiding and all that. Which category are you saying that Senator Corzine fits into?

ZAMANSKY: I'll be blunt. We are alleging that Corzine lied to the employees and the shareholders. He told them that the company was in great shape. He told them to tell the customers that. We are going to show, we're going find documents, we are going to show that Corzine committed securities fraud, he misled the company, and that's fraud. That's not making a bad decision. If you are going to make a bet like that, tell everybody.

VAN SUSTEREN: Jacob, thank you very much. I hope you come back as the case proceeds and we can see what is going on with it. Thank you, sir.

ZAMANSKY: Look forward to it. Thank you.