Book description
Penguin Specials are designed to fill a gap. Written to be read over
a long commute or a short journey, they are original and exclusively
in digital form. This is John Gapper's foray into the world of rogue traders.
Unlike most bankers, they are household names: Nick Leeson of
Barings, Jerome Kerviel of Societe Generale, John Rusnak of Allied
Irish Bank. And now the 31 year-old Kweku Adoboli, who allegedly ran
up . 3bn in losses at UBS. These are the men who have bought banks to
their knees and global financial systems to a halt. Each time the
banks declare themselves to be innocent victims of a fraud.
But why do traders keep on committing apparently senseless crimes,
with little benefit apart from higher bonuses and a risk of ending up
in prison? And why do banks, which should have learned the tricks of
the traders, keep being deceived?
In this Penguin Special, the Financial Times' associate
editor John Gapper unlocks the mystery by delving into the
evolutionary risk-taking instincts of both humans and animals - from
yellow-eyed junco sparrows in Arizona to honey-bees. He reveals how
banks encourage their traders to evade risk limits, and shows how the
rogue traders merely mimic the strategies used by their firms to seem
more profitable than they really are.
A rogue trader is often an outsider who starts in a lowly role and
gambles with a bank's money in a bid to become a star. Gapper traces
patterns of behaviour and personality that could be used to catch them
before disaster strikes. But do the banks really want to? And are the
rogue traders just the symptoms of a financial system gone rogue?
John Gapper is Chief Business Commentator and Associate Editor of the
Financial Times
. His awards include Business Commentator of the Year at the 2011
Editorial Intelligence Awards and Best Columnist in the 2011 Society of
American Business Editors and Writers awards. He was named one of
GQ
's 100 most influential men in Britain in 2009. He studied at Oxford
University and the Wharton School. He is co-author with Nick Denton of
All That Glitters
, the definitive account of the collapse of Barings bank, and a
financial novel to be published by Random House US in 2012. He lives in
Brooklyn, New York with his wife, the novelist Rosie Dastgir, and their
two daughters.
