We have studied the electronic structure and charge ordering (Verwey) transition of magnetite (Fe3O4) by soft x-ray photoemission. Due to the enhanced probing depth and the use of different surface prepns. we are able to distinguish surface and vol. effects in the spectra. The pseudogap behavior of the intrinsic spectra and its temp. dependence give evidence for the existence of strongly bound small polarons consistent with both d.c. and optical cond. Together with other recent structural and theor. results the findings support a picture in which the Verwey transition contains elements of a cooperative Jahn-Teller effect, stabilized by local Coulomb interaction. [on SciFinder (R)