Tricksters of the trade

Each rogue trading loss drives an increased emphasis on the sharpening of controls. So why dothey keep occurring? Do banks learn anything from the actions of the Kerviels and Leesons ofthis world, or is it more a case of these events off ering a textbook on how future rogue traderscan avoid detection?

The world’s banks house armies of traders sitting in rank and file, connected to their markets via phones and glowing screens. They buy and sell everything from grain and corporate debt, to equity options and market volatility itself. Their powers and responsibilities are tightly prescribed and their activities are closely monitored. But occasionally, one of them breaks free.

“Banks do an extraordinary thing when you think about it,” says Jonathan Howitt, head of operationalrisk with fund manager