Consider Andrew Krieger, who made a boatload of money for MS trading foreign currencies. Had he gone wrong, he could have blown up MS. As it was, MS did not pay him what was promised in his comp agreement, which would have been a huge sum of money even in this era. He left and sued. No idea how it turned out.
Risk controls then weren't what they are now... but still, the tendency of management to accept gratuitous gains and look the other way remains. Losers get called rogues to protect the managements with bad risk controls.
Entry: Why Do Rogue Traders Always Lose Money?
posted by davidmerkel
Feb 28, 2008 1:01PM
Consider Andrew Krieger, who made a boatload of money for MS trading foreign currencies. Had he gone wrong, he could have blown up MS. As it was, MS did not pay him what was promised in his comp agreement, which would have been a huge sum of money even in this era. He left and sued. No idea how it turned out.
Risk controls then weren't what they are now... but still, the tendency of management to accept gratuitous gains and look the other way remains. Losers get called rogues to protect the managements with bad risk controls.