MF Global, the investment firm whose stunning collapse under the leadership of former NJ governor Jon Corzine is being investigated by the feds, illegally diverted about $1 billion of client funds, which are still missing. Now it looks like the company transferred $200 million of client money just three days before filing for bankruptcy!

Dealbook reports, "One e-mail chain refers to the transfer of roughly $200 million that MF Global owed JPMorgan Chase on Oct. 28 — the firm’s last business day before it filed for bankruptcy. In that chain, a senior official in the firm’s Chicago office was told to make the transfer, said the people close to the investigation who requested anonymity because the inquiry was still open... It was not clear who had directed [MF Global treasurer Edna] O’Brien, whose job was to oversee the customer money, to make the Oct. 28 transfer." And according to the Wall Street Journal:

The transfer has drawn interest from investigators partly because J.P. Morgan asked MF Global in a letter the following day to attest that the Oct. 28 shift of funds didn't violate regulations designed to protect customer money...

The letter indicates that J.P. Morgan officials knew the money came from segregated customer accounts, because it specifically asked whether the transfer of funds from customer accounts was compliant with regulations. Customer accounts can contain both customer and firm funds. On Oct. 30, or the day after the letter was sent, MF Global alerted regulators to a shortfall in customer funds. It filed for bankruptcy protection on Oct. 31.

The missing money was from clients like hedge funds, traders, and even farmers. Corzine, who resigned in the wake of the firm's problems, has insisted that he didn't tell employees to misuse the client funds. And O'Brien, who is still employed by MF Global and is overseeing the liquidation of the brokerage unit, has hired a criminal attorney.