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Federal regulators are poised to sue Jon S. Corzine over the collapse of MF Global and the brokerage firm’s misuse of customer money during its final days, a blowup that rattled Wall Street and cast a spotlight on Corzine, the former New Jersey governor who ran the firm until its bankruptcy in 2011, the New York Times DealBook blog reported today. In a rare move against a Wall Street executive, the Commodity Futures Trading Commission (CFTC) has informed Corzine’s lawyers that it aims to file the civil case as soon as this week without offering him the opportunity to settle, setting up a legal battle that could drag on for years. Without directly linking Corzine to the disappearance of more than $1 billion in customer money, the trading commission will probably blame the chief executive for failing to prevent the breach at a lower rung of the firm, the law enforcement officials said. If found liable, he could face millions of dollars in fines and possibly a ban from trading commodities, jeopardizing his future on Wall Street.

The U.S. Justice Department is seeking a trial in February 2015 in its lawsuit against McGraw Hill Financial Inc.’s Standard & Poor’s unit over ratings on residential mortgage-backed securities, Bloomberg News reported yesterday. A jury trial on liability would take an estimated 54 days, according to a joint filing yesterday by the Justice Department and S&P in federal court in Santa Ana, Calif. The Justice Department wants a separate penalty phase to be decided by U.S. District Judge David Carter without a jury. The government seeks more than $5 billion in penalties from S&P, according to the filing. S&P is accused in the lawsuit of deceiving investors, including federally insured financial institutions, by giving its highest credit ratings to mortgage-backed securities and collateralized-debt obligations because it wanted to gain business from the issuers of the securities and not because the securities merited these ratings.

Employees of some of the world's largest financial institutions conspired with a former bank trader to rig benchmark interest rates, British prosecutors alleged yesterday, the Wall Street Journal reported today. The U.K.'s Serious Fraud Office this week charged former UBS AG and Citigroup Inc. trader Tom Hayes with eight counts of "conspiring to defraud" in an alleged attempt to manipulate the London interbank offered rate, or Libor. Hayes, who was charged with similar offenses by the U.S. last December, hasn't entered a plea to either country's charges. The charges read in court yesterday accuse Hayes of allegedly conspiring with employees of eight banks and interdealer brokerage firms, as well as with former colleagues at UBS and Citigroup. The banks include New York-based J.P. Morgan Chase & Co., Germany's Deutsche Bank AG, British banks HSBC Holdings PLC and Royal Bank of Scotland Group PLC and Dutch lender Rabobank Groep NV.

Wells Fargo & Co. faces a second Minnesota trial over claims by institutional investors that the bank marketed a risky securities-lending program as safe and cost them millions of dollars in losses, Bloomberg News reported today. The case is one of at least five in Minnesota against Wells Fargo over its securities lending. Wells Fargo lost the first to go to trial in 2010, when a state court jury awarded Minnesota Workers’ Compensation Reinsurance Association and three charitable foundations about $30 million, a judgment that was upheld on appeal. Wells Fargo is scheduled for a third trial on the same claims from different plaintiffs in September, brought as a class action or group lawsuit on behalf of about 100 institutional investors. Two other cases are also pending in federal court, including one by Minnesota Life Insurance Co. seeking $40 million in damages.

JPMorgan Chase & Co.'s asset-management division will begin disclosing to investors the amount of liquid assets held in its U.S. money-market-mutual funds each day on its website, the Wall Street Journal reported today. Investors will be able to view each fund's percentage of assets that are liquid on a daily and weekly basis, a move JPMorgan is making to increase transparency in its funds. The decision follows moves by money managers like JPMorgan, Goldman Sachs Group Inc. and BlackRock Inc. earlier this year to begin disclosing the values of their funds daily to investors rather than monthly. The transparency of money-market funds is one of the issues the Securities and Exchange Commission is hoping to tackle as part of recently proposed new rules regulating the $2.6 trillion industry.

Private equity firms are sitting on $116 billion of assets trapped in so-called zombie funds that lie dormant but still rake in fees from investors, Reuters reported yesterday. Almost 1,200 private equity funds can be classified as "zombie"—poor-performing funds that have been retained beyond their planned life span and whose managers have little hope of raising more money—according to data from industry tracker Preqin. Despite the funds being inactive, general partners still collect management fees from investors. U.S. regulator the Securities and Exchange Commission is investigating the use of these essentially inactive funds, which critics say drain money from pension funds and other investors that would otherwise be available to reinvest or return to clients. It is part of a wider SEC probe into the private equity industry as a whole.

Shareholders in BMC Software Inc. will receive $6.9 billion to sell the corporate-software developer to a group of private-equity firms, but the buyers, led by Bain Capital LLC and Golden Gate Capital, only intend to pay $1.25 billion in cash out of their own pockets, the Wall Street Journal reported today. The rest will come from debt raised by BMC to finance its takeover. The little-noticed acquisition is another milestone in the return of cheap debt and higher-risk deals to Wall Street: The cash put down by BMC's private-equity buyers is the lowest as a percentage of the purchase price of any buyout with loans exceeding $500 million since 2008, according to data-provider Thomson Reuters LPC. The last buyouts with equity contributions comparable to BMC's were those of Harrah's Entertainment Inc. in 2008 and Clear Channel Communications Inc. in 2007, according to data from Thomson Reuters. Both firms have struggled under the resulting leverage and restructured some of their debts, triggering downgrades by credit raters.

Some of biggest banks on Wall Street will get an additional two years to comply with a post-financial crisis rule requiring they move risky swap activities into separate affiliates, the Wall Street Journal reported today. The Office of the Comptroller of the Currency (OCC) said that it granted extensions to seven banks, giving them until July 2015 to comply with so-called "swaps push-out" rules required by the 2010 Dodd-Frank law. While the move was largely expected, the OCC's action could further inflame criticism that much of Dodd-Frank remains undone nearly three years after its passage. As of June 3, just 38 percent of rules required by Dodd-Frank had been finalized, while 63 percent of rule-writing deadlines have been missed, according to law firm Davis Polk. The OCC notified Bank of America Corp., J.P. Morgan Chase & Co., Citigroup Inc., Wells Fargo & Co., HSBC Holdings PLC, Morgan Stanley and U.S. Bancorp that they were granted a 24-month extension in response to their requests for a longer transition period.

Royal Bank of Canada, the country’s largest lender, and several units were sued by Rakuten Bank Ltd. over claims it marketed and sold unsuitable securities backed by deteriorating mortgage loans that wiped out a $10 million investment, Bloomberg News reported yesterday. RBC induced Rakuten to invest 1 billion Japanese yen ($10.3 million) in a tranche of notes in a collateralized debt obligation called Logan CDO III Ltd. in June 2007. The notes ultimately became worthless when Rakuten sold them in December 2008 “for a nominal sum equivalent to approximately one cent,” according to a summons filed yesterday in state court in Manhattan. The lawsuit, which accuses RBC of fraudulent misrepresentation, is seeking to recover the U.S. dollar equivalent of the investment plus interest.

A Securities and Exchange Commission judge ruled that a former Maryland banker perpetrated a short-selling fraud aided by one of the biggest stock-options brokers in the U.S., the Wall Street Journal reported today. Jonathan Feldman, who was accused by the SEC of trading billions of dollars of stock and options in ways that misled other investors, was found by the judge to have engaged in a practice regulators say has grown more prevalent in recent years: "naked short selling." The decision makes it more likely the SEC will proceed with other enforcement cases involving similar activity. An SEC administrative law judge—an independent judicial officer who rules on SEC allegations of securities-law violations—late Friday ordered Feldman to disgorge $2.7 million in profits from his alleged trading scheme and to pay a $2 million civil fine. The judge also ordered optionsXpress Inc., a brokerage firm owned by Charles Schwab Corp., to disgorge $1.6 million and to pay a $2 million civil fine for allegedly violating laws prohibiting naked short selling.