A rogue trader is an authorised employee Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as: "A person in the service of another under any contract of hire, express or implied, oral or written, where the employer has the power or right to control and direct the employee in the material details of how making unauthorised trades on behalf of their employer Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as: "A person in the service of another under any contract of hire, express or implied, oral or written, where the employer has the power or right to control and direct the employee in the material details of how. It is most often applicable to financial trading, and as such is a term used to describe persons - professional traders In finance, a trader is someone who buys and sells financial instruments such as stocks, bonds, commodities and derivatives. A broker who simply fills buy or sell orders is not a trader, as they are merely executing instructions given to them - making unapproved financial transactions.
This activity is in the grey area between civil and criminal illegality for the reason that the perpetrator is a legitimate employee of a company or institution, yet enters into transactions on behalf of their employer without permission.
One famous rogue trader is Nick Leeson Nicholas "Nick" Leeson is a former derivatives broker whose fraudulent, unauthorized speculative trading caused the collapse of Barings Bank, the United Kingdom's oldest investment bank, for which he was sent to prison. Since leaving prison in 1999 he has become the CEO of Irish football club Galway United and an after dinner speaker, whose losses were sufficient to bankrupt Barings Bank Barings Bank was the oldest merchant bank in London until its collapse in 1995 after one of the bank's employees, Nick Leeson, lost £827 million ($1.3 billion) speculating—primarily—on futures contracts in 1995 following his ill-advised and unauthorized investments in index futures. Through a combination of poor judgement on his part, lack of oversight by management, a naive regulatory environment and unfortunate outside events like the Kobe earthquake The Great Hanshin earthquake , or Kobe earthquake as it is more commonly known outside Japan, was an earthquake that occurred on Tuesday, January 17, 1995, at 05:46 JST in the southern part of Hyōgo Prefecture, Japan. It measured 6.8 on the Moment magnitude scale (USGS), and Mj7.3 on the revised (7.2 on the old) JMA magnitude scale. The tremors, Leeson incurred a $1.3 billion 1,000,000,000 is the natural number following 999,999,999 and preceding 1,000,000,001 loss that bankrupted the centuries-old financial institution.
Table of largest rogue trader losses
See also
Categories: Rogue traders
