A View From Middle England - Conservative with a slight libertarian touch - For Christian charity and traditional belief - Free Enterprise NOT Covert Corporatism

Thursday, January 24, 2008

Rogue trader runs up a tidy sum in bank fraud!

In the "it can't get much worse" department, French bank Societe Generale gets done by a rogue trader. The bank says it has uncovered "massive" fraud by a Paris-based trader, Jerome Kerviel (pictured), which resulted in a loss of €4.9bn ($7.1bn; £3.7bn). The rogue trader has done a disservice to his employers in two ways. The second is that they have had to come clean about losses of €2.05bn related to the sub-prime mortgage crisis in the US. This begs the question - are all banks subject to such sub-prime losses?

The problem with banks today is that they have let in the chancers and got rid of the local bank manager who knew something, if not everything about, his/her customers. Initially, the long distance approach met with approval, but gradually people have come to the conclusion that banks are glorified gambling outfits with spivs, chancers, and, yes, a few crooks, at the helm.

In Britain, the Chancellor of the Exchequer blinks wearily at the problems before him. Northern Rock has proved to be a sandstone based on a gamble. The Financial Services Authority has little authority and offers precious little in the way of service to the citizens.

We need transparency in our banking system, not behind the scenes deals and secretive policy making.


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