Rogue Trader

882 Words Feb 20th, 2014 4 Pages
Rogue Trader

How many times can you go double or nothing before you wind up a billion pounds in debt? In “Rogue Trader”, a film based on the life on Nick Leeson, we get a glimpse into this real world dilemma. The drama begins with Leeson’s promotion to general manager of Barings Futures Singapore. As general manager, he faces a personal quandary and must decide whether to cover for a friend and coworker who made an honest mistake (one that resulted in the loss of a substantial amount of money) or to turn the same person in to face termination. Leeson chooses loyalty to his friend over loyalty to the bank, and covers up the losses by creating an error account. This account served to hide said losses while Leeson tried to make back the
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Additionally, throughout the movie, almost no top executives came to Singapore to make sure that the new business operation was running smoothly. Lack of training to recognize risk was also a problem since Leeson’s assistant, Risselle, was not competent enough to question or whistle blow on the creation of the 88888 account and other questionable actions asked of her, even though they were obviously high risk. One major problem was the lack of an early detection system in place for risky behavior—auditors were only present in new market AFTER there was a flag in the system, not as the new market was being set up. Why was there not an external auditor or consultant that was contracted to specifically deal with risk assessment for employees? More generally Barings Future Singapore is inherently risky because SIMEX is an emerging market, one where nobody can predict the rise and fall. This becomes obvious when the stock market crashes as a result of the Kobe Earthquake in the movie. Furthermore, risk increases as business increases (volume). An example of this is when Leeson takes on Beaumarchais as a client, knowing his business volume was a quarter of the SIMEX market. That is too much volume for a fledgling market.
Control Activities is another area that was grossly overlooked in “Rogue Trader”. Firstly, Barings board members delegated auditing tasks to staff that didn't follow through with the entire process. This can be seen in the

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