There’s a wonderful comic opera currently playing out in (so our protagonist hopes) the French courts: A one-time software salesman gets laid off and decides to try his hand at day trading. Since he knows practically nothing of this, he decides to practice with Monopoly money via the demo version of a British brokerage’s online platform. To gain access thereto, he plays a little fast and loose with his trading experience by claiming he has so, and thusly opens an account with said brokerage. A whole series of comic misunderstandings follow. For instance, the day-trader-in-training, Harouna Traoré, only thinks he’s play-acting, when in fact he’s trading actual equity futures. The brokerage, Valbury Capital, says it has trading limits, but proceeds to allow Traoré to place €1 billion worth of orders in spite of his account having all of €20,000 in it.
Eventually, Traoré realizes his mistake, discovering that he’d lost €1 million that he didn’t have on that €1 billion that he also didn’t have on Valbury’s actual platform, which again for some reason let him make €1 billion worth of trades. Rather than fess up and potentially find himself on the hook for this, Traoré decides to make right, daringly building a $5 billion portfolio with his €20,000 account and turning a €10 million profit. The day is saved! Everyone is happy! Except, of course, the villain in our tale, Valbury CEO Mark Hanney, last seen running the U.K. arm of a little outfit called Refco, who—facing a 15% drop in revenue and Valbury’s third straight annual loss—decides to solve his problems by declaring Traoré’s trades “manifest errors” and thereby seize the €10 million the father of two had rather deliberately made. Act V, still unwritten, takes place in the French or British courts.
All of which is very interesting and quite amusing, but in its way besides the point. Here we have a rookie trader who accidentally suffered a big loss—and managed to turn around and not only cover that loss but turn a profit 10 times its size! Why is he not running a Paris office of Point72 or improving Tudor’s returns or rubbing David Tepper’s brass balls for luck? Looking for talent, Steve Cohen? Throw those resumes in the trash and read this legal filing.