Ex-French trader must pay $6.7 billion for fraud
news.yahoo.com
news.yahoo.com
Official apology : we didn't know what he did. It's hard to believe no-one knew what was happening. If they are that incompetent, it may be wise to use competitors.
Some were let go. Not the Big big boss though. he cheated the system. By moving up through the ladder he gains good knowledge how to bypass security (that was poorly designed, but again 12 years ago that wasn't the focus), he became an insider threat and use his knowledge to abuse the system. I don't think they (bosses) were aware they were making profits.
74 Alarms triggered and no one said anything or did anything. I'm more inclined to believed that they were happy when he made money but also would not be taking the blame if it went sour, which it did.
They effectively looked the other way that is my only conclusion.
Yea, I know someone is going to say don't attribute to malice what can be explain with incompetence, but it is hard for me to believe that they didn't know and just looked the other way.
In my opinion, his bosses should be culpable.
People always waste energy wanting to demonize or glorify when they should analyze. It is not hard for me to believe that bank managers could be clueless rather that criminal. Let's hear one suggestion that will prevent such cases in the future.
This case strikes me as similar to the Joe Jett/Kidder Peabody case a few years earlier. Self-deluded trader, weak accounting system, lax controls, clueless manager. Result: A big loss that destroyed the bank. Banks have far more privacy in their financial life than individuals. I think we need to rethink how well closed information systems (like a bank) serve us as individuals and society.
Banks already listened to many suggestions and implemented them back in 2008/2009.
One very well known example, which wasn't specific to any individual bank: every US bank now has 2 contiguous weeks of mandatory vacation (i.e., someone not under your control will be managing your books for 2 weeks).
Shouldn't it be "French ex-trader"?
This ruling is crazy (pay back everything (how??) and go to prison for three years). I very much doubt it can stand on appeal.
It's difficult enough to find a job as a trader now. The banks would simply choose the traders with the most risk taking potential. I personally think it's a step in the wrong direction. It's the employer who has to be made act responsibly, not the individual traders.
Hogwash. I smell foul play. How would a $6.7 billion fine prevent people from doing this any more than $100 million? They made this number big so that the PUBLIC would see it and think "yay, someone has taken responsibility for it all" but allows the bank to get away scot free. He was definitely a fall guy.
But the period was bad for the trader, Société Général was in a bad shape due to their subprime losses. So it was easier for SG to charge the insider trader than willing to find an agreement. Especially that would cover the current subprime losses as not originating (even if the banks lacks controls or auditing) from the bank itself but more from the "evil" trader.
The surprise is now more coming on the judgment itself where the internal bank operation was not deeply analyzed. If you are old enough, you may remember the Crédit Lyonnais fire in Paris destroying the whole archive in 1996. Maybe the appeal would go more in the archive of SG and re-balance a bit the judgment...
They could have slapped him with a million dollar fine or something along the lines of 5-7 years worth of income to make everyone start paying attention.