Where Did All the Rogue Traders Go?

Plus: The Bank Behind the Fintechs, Metromile, Starling

Happy Thanksgiving to all American readers and welcome to another issue of Net Interest, my newsletter on financial sector themes. Each week I go deep on a topic of interest and highlight a few other trending themes underneath. If you like it, please share the joy. Thanks!

Where Did All the Rogue Traders Go?

Towards the middle of the 1990s I applied for a graduate job at Barings Bank. The bank was over two hundred years old and they wooed potential recruits with stories of grandeur. They told of how they’d financed the United States’ purchase of Louisiana, of how they had members of the Royal Family as clients. They were once even dubbed, “the sixth great European power”. Fortunately I didn’t get the job, because within a year the bank was bust.

Nick Leeson wasn’t the first rogue trader in history and, despite the controls put in place after he’d brought down Barings, he wasn’t the last. Not six months after Leeson was caught, a trader in Daiwa Bank’s New York office confessed to over te…