Former MF Global official Edith O'Brien said in an October 2011 email that CEO Jon Corzine gave "direct instructions" to transfer $200 million from a customer account to cover an overdraft in its account at JPMorgan in London, according to a congressional memo released on Friday.

The October 28 email, written days before MF Global's collapse, was quoted in a document released in advance of a House Financial Services subcommittee hearing scheduled for next week on the collapse of brokerage MF Global and the continued search for missing customer funds. The committee this week subpoenaed O'Brien to appear before the panel.

Steven Goldberg, a spokesman for Corzine, said that Corzine has testified before Congress that he asked that the JPMorgan Chase & Co (JPM.N) overdraft be corrected, but never gave any instructions to misuse customer funds.

"He never directed Ms. O'Brien or anyone else regarding which account should be used to cure the overdrafts, and he never directed that customer funds should be used for that purpose," Goldberg said in an email on Friday.

Goldberg added that Corzine testified "he recalls having received written material indicating that the funds used to cure the overdrafts were appropriate for that purpose."

A representative for JPMorgan Chase was not immediately available for comment.

O'Brien served as an assistant treasurer in the firm's Chicago office.

She has not been accused of any wrongdoing. It was not known if she might choose to invoke her right against self-incrimination at the hearing next week.

MF Global filed for bankruptcy on October 31 after it was forced to reveal that it had made a $6.3 billion bet on European sovereign debt, spooking investors and customers. Corzine resigned as CEO days later.

A trustee liquidating the firm has estimated the customer funds shortfall could be as high as $1.6 billion.

Congressional and regulatory officials have been investigating whether customer funds were improperly transferred in the chaotic days before the firm collapsed and what executives knew about the status of various accounts.

The $200 million transfer from a customer fund account to JPMorgan was made to cover a $175 million overdraft in one of MF Global's accounts at the bank in London, the memo said.

The memo prepared by committee staff points out that segregated customer accounts like the one in question can contain funds that belong to the futures brokerage and can be used for transfers.

The memo says, however, that JPMorgan chief risk officer Barry Zubrow called Corzine directly to seek assurances that the funds being transferred belonged to MF Global and did not include customer funds.

The bank followed up with a letter requesting written assurances that all MF Global transfers - "past, present and future" - complied with Commodity Futures Trading Commission rules about keeping customer money separate from the broker's own, the committee staff said.

Laurie Ferber, MF Global Holding's chief lawyer, balked at the request as being too broad and sought to narrow the written assurance to include only the October 28 transfer, the memo said.

MF Global employees drafted several versions of the letter but the firm did not return one to JPMorgan before it collapsed.

The committee document says Corzine identified JPMorgan Chase and Interactive Brokers as the parties "most interested" in purchasing MF Global assets as he updated regulators of efforts find a buyer.

Next week's hearing is the latest in a series of congressional efforts to grill former senior managers of MF Global.

Former Chief Executive Jon Corzine, Chief Financial Officer Henri Steenkamp and Chief Operating Officer Bradley Abelow have all testified to Congress, and denied any intent to misuse customer funds and any specific knowledge of how that misuse may have occurred.

None have been formally accused of any wrongdoing.

(Reporting By Alexandra Alper, Sarah N. Lynch and Ann Saphir; Editing by Bernard Orr)

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