Jerome Kerviel As A Structural Problem

By Joe Weisenthal

So how did Soc Gen’s infamous rogue trader get away with building up those huge positions? Joe Seet says the accounting control and risk operations from proprietary trading at many investment banks have serious inadequacies. It’s one part intellectual. The back office staff often lacks experience necessary to understand complex trades. And one part psychological: the back office is all too often awe of the traders. The problem, he warns, is not confined to Soc Gen.
Serious Lapses of Operational Control at Societe Generale; were they avoidable? [Sigma Partnership]

Comments (4)

  1. 1
    Posted by just me | February 14, 2008 at 3:19 PM

    Stop making lame-ass comments about people being in awe of prop traders. Didn’t anyone notice that his margin calls got bigger and bigger and that there was no cash coming in? Oh right , with bank accounting its not cash, its mark to mkt. What a fucking joke, any other business would be bankrupt and put out of its misery by now.

  2. 2
    Posted by anonymous | February 14, 2008 at 3:21 PM

    Jerome! Jerome! Put on that Bobby Womack!
    Nah girl I wanna go way back, ahh yeah check this out..

  3. 3
    Posted by Anonymous | February 14, 2008 at 4:03 PM

    This Joe Seet guy is dead-on correct.

  4. 4
    Posted by guest | March 27, 2008 at 2:35 PM

    http://www.investmentpostcards.com/wp-content/uploads/2008/03/sg.jpg

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